New update: members of Whatwg are now claiming that XSLT should not be supported because it could facilitate XSS attacks:
https://github.com/whatwg/html/issues/11578#issuecomment-3206821235
XSS stands for Cross-Site Scripting, and it's basically the idea that if a site is designed without adequate security precautions then an attacker can inject malicious scripts into a page.
For example, if I were to add some malicious code to this post, a Fediverse platform might add it to the page in a way that would indirectly run that code in your browser session when you view it. The platform on which you view it is therefore responsible for displaying posts in a way that treats them as untrustworthy inputs, rendering their content as text rather than full-featured and potentially dangerous HTML.
XSLT transforms XML documents into different structures, which might include scripts if the transformation injects untrusted inputs, but this is just a part of the way the web works regardless of your choice of markup language.
There are of course many legitimate cases where you'd want to inject JavaScript into a page written with XML, just as there are with pages written in HTML. Of course, these same people are not making the case that we should remove JavaScript from HTML.
This argument just doesn't hold up to any detailed scrutiny, but I guess they're hoping that people will see an acronym for an attack, and just accept it as justification for whatever they want to accomplish.