XQuery is, in many ways, XSLT with better syntax. It doesn't have the pattern-matching transforms that are the T in XSLT - but for configs, I don't think it makes a big difference.
Also, I don't think many realize that the stack has evolved since early 00s. XSLT 1.0 was a very limiting language, requiring extensions for many advanced scenarios. But there's XSLT v3.0 these days, and XPath & XQuery v3.1, with some major new features - e.g. maps and lambdas. Granted, this doesn't fix the most basic complaint about XSLT - its insanely verbose syntax - but even then, I'd still take XSLT over ad-hoc YAML-based loops and conditionals.
Also, I don't think many realize that the stack has evolved since early 00s. XSLT 1.0 was a very limiting language, requiring extensions for many advanced scenarios. But there's XSLT v3.0 these days, and XPath & XQuery v3.1, with some major new features - e.g. maps and lambdas. Granted, this doesn't fix the most basic complaint about XSLT - its insanely verbose syntax - but even then, I'd still take XSLT over ad-hoc YAML-based loops and conditionals.