He comes back grovelling and says...
It now works, I have fixed MY problem. A case of not seeing the wood for the trees.
I installed everything on a different (Solaris 2.6) system and it worked ok.
I went back to the old one (SuSE Linux 7.1) and went step-by-step over the setup.
I found that I was NOT in fact using Xalanj2.0.1 but Xalanj1.2.2. I quickly
installed the latest version and found that I could generate the whole example
website. I still use the absolute form of file reference: file:///<path>/<file>.xml
and that works ok.
Now the real fun begins...
-barry (very small font)