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Transforming Xml into valid Html fragments through Xslt using .NET XslCompiledTransform class
string xslt = @"<xsl:stylesheet version=""1.0"" xmlns:xsl=""http://www.w3.org/1999/XSL/Transform"">
<xsl:output method=""html"" indent=""no""/>
<xsl:template match=""*"">
<p>some html</p>
</xsl:template>
</xsl:stylesheet>", xml = @"<xml>boo</xml>";

var transform = new XslCompiledTransform();
using (var sr = new StringReader(xslt))
using (var xr = XmlReader.Create(sr))
{
    transform.Load(xr);
}

using (var sw = new StringWriter())
using (var sr = new StringReader(xml))
using (var xr = XmlReader.Create(sr))
{
    transform.Transform(xr, null, sw);
    string html = sw.ToString();
}