Thanks to George Langlais for correctly identifying that attributes to not need to be prefixed.
See his comments here
http://www-10.lotus.com/ldd/nd6forum.nsf/DateAllThreadedweb/55b5693558b1eb5d85256c5c0061ac64?OpenDocument
Here is the resulting working code.
<?xml version="1.0" encoding="ISO-8859-1"?>
<xsl:stylesheet xmlns:xsl="http://www.w3.org/1999/XSL/Transform" version="1.0"
xmlns:dxl='
http://www.lotus.com/dxl'>
<xsl:output method="html" indent="yes"/>
<xsl:template match="/">
<HTML>
<HEAD>
<TITLE>Blog</TITLE>
</HEAD>
<BODY bgcolor="#ffffff" marginheight="0" marginwidth="0"
leftmargin="0" topmargin="0">
<xsl:apply-templates select="dxl:database"/>
</BODY>
</HTML>
</xsl:template>
<xsl:template match="dxl:database">
<TABLE width="100%" cellpadding="0" cellspacing="0" border="0">
<xsl:apply-templates select="dxl:document"/>
</TABLE>
</xsl:template>
<xsl:template match="dxl:document">
<TR>
<TD border="0">
<A>
<xsl:attribute name="href">
<xsl:value-of select="dxl:item[@name='Link']/dxl:text"/>
</xsl:attribute>
<xsl:value-of select="dxl:item[@name='Title']/dxl:text"/>
</A>
<BR>
<xsl:value-of
select="dxl:item[@name='Description']/dxl:text"/>
</BR>
</TD>
</TR>
</xsl:template>
</xsl:stylesheet>