I barely used xslt, but as a fp head I wanted to try, the most confusing part to me were terminology / semantics / decoupling. Seemed like matching templates could be anywhere making difficult to understand the meaning of a script.
In some sense that's a strength. When things can happen in any order you can mash together two things and they work together.
When I was looking for my own revolution in software engineering I saw one part of the low code/no code puzzle was that conventional tools force you to determine what order events happen which was something laymen shouldn't be bothered to do. Some counters are: spreadsheets (they figure out what order to calculate it), make (does a topological sort), dependency injection tools like Spring (writing a FactoryFactoryFactory isn't so bad, but maintaining it is a disaster when a "small" change means you have to reorder the order in which you construct everything)
There is a "freedom is slavery" problem here. People saw the semantic web as "you're going to exhaust yourself arguing with people about standards and ontologies before you even start coding" and not "if my data is properly namespace I can throw data from 10 different sources together into my RDF database and start writing queries".
The node pattern matching was ok, but as far as i can recall, there could be multiple matching patterns scattered in lots of places (a 180deg turn compared to most FP pattern matching that aim for exhaustiveness ?)
Exhaustiveness is only relevant for the compiler-managed pattern matching of a traditional FP type system, where you need to write an implementation (patterns that will be used at matching usage sites) for everything that your types promise.
XSLT pattern matching is the plain kind: here is a pattern, look for it in the input and process every match. If some part of the input document is ignored, it's just not useful; if some part of the input document is processed several times, it's perfectly well defined.
The problem here is runtime includes, especially the "drop source in place" style includes, coupled with dynamic dispatch at runtime. These two things in combination make static analysis of execution flow anywhere from really hard to impossible
If by "hard to track" you mean not knowing what template is producing an observed bad output, the modularity of self-contained templates and XPath expression is likely to help with debugging.
