The output document shows as a junk of text, from which the element tags have been rendered off.
The easiest way is to specify the stylesheet in the XML document and then open the XSL document in Internet Explorer.
I use Microsoft IE6, in which I have installed MSXML3.0 parser in replace mode.
For studying the output of XSLT transformations I use Microsoft IE tools for validating XML and viewing SXLT output. I've been having lots of problems with character encodings, since I have use iso-8859-1.
These are referred to as "Internet Explorer Tools for Validating XML and Viewing XSLT Output", and can be downloaded for free from Microsoft.
The download is quite small and the installation quite straightforward.