I am using version 0.48 for XML::XSLT as recently downloaded from CPAN.
I copied that in my home directory and now, I get the message : Can't call method "createDocumentFragment" on an undefined value at XML/XSLT.pm line 766.
This sounds like you are trying to process a stylesheet without having loaded an XML document first. Please could you supply the smallest piece of code and sample XML and XSLT files that give this error - I'm pretty sure the code you have above wouldn't do this because it XML::DOM's createDocumentFragment() is only used when certain XSLT directives need to insert generated elements into the outout document.
BTW don't bother following up the cpanforum posting, I'm not going to respond in both places.
Quite. But if it is a bug I will need to see the XSL to diagnose and fix it. From the location of the error it would appear that the problem is with the way either a <xsl:variable /> or <xsl:param /> is being dealt with but I'd still need to see the inputs to see what is really going on.