TheServerSide mentions a series of tutorials about XQuery and XQJ (XQuery Java interface).
I've never really believed into XML as a replacement storage format for "real" (e.g "serious") databases. However, I believe into XML as a new interface around databases, or as a convenient local storage when requirements are limited (no transactions, single-user, lo logging, no locking) for pervasive computing or long-running transactions for instance.
The same way, I've never bought the concept of an XML server or XML programming. I don't see XML as being simpler than Java or more readable.
Finally, I used to be reluctant regarding data integration solutions aggregating everything through XML. This could be OK for non transactional, read-only applications but not for highly transactional applications.
But when it comes to Data Services, e.g. integrating, mapping, transforming and publishing databases and data services as services then you'll probably need XML somewhere. The SDO 2 marshalling is built on top of XML. From a DAS perspective there is now the question of which Query Language to be adopted. It could be SQL, an object query language (JPAQL, JDOQL, OQL, OSQL...), it could be a programmatic QL or even LinQ.
Within the Xcalia DAS, we currently support JDOQL, SQL and LinQ (only in .Net). We also intend to support JPAQL, as soon as we will support JPA 2 in XIC. But it becomes clear, as the SDO datagraph is serialized in XML, that XQuery is a good candidate for an alternate QL. This is an option we will certainly investigate in 2008.