All of the XML Actions include an MSXML Parser property page. This allows you to set the version of the MSXML Parser to use for the file, as well as some parser-specific options.
You can specify which version of the MS XML parser to use to parse the file. In most cases, "Highest Available" will be fine.
"Automatically use namespace prefixes declared in document root node"
If this option is checked then the XML Parser will expand any xmlns: attributes that it finds in the document root node. This enables the use of XPaths which reference nodes with XML Namespace prefixes.
This option is included to overcome a shortcoming in MS XML, whereby XPaths do not automatically take into consideration namespaces or namespace prefixed nodes within a document.
"Identifier prefix for default namespace"
If the document specifies a default namespace, you will still need to use a custom prefix in order to reference it in your XPath. Specify the prefix to use here.
If a namespace prefix is declared somewhere other than the document root node, you need to list it here so that you can specify an XPath which references that namespace. An alternative is to add the relevant declaration to the document root node.
Document Parsing Options
"Validate document when parsing" - If this option is enabled, the XML content will be validated when it is loaded by the parser. If validation fails, the action will fail. Note that XML which is not well formed will always fail the action.
"Resolve external definitions" - If this option is enabled, the XML Parser will attempt to load any external definitions (XML Schema, DTDs, etc.) which are specified inside the XML file. Parsing will fail if any external files are not available.