Help describing the behavior of a Path Expression

Hi all -

apologies for the awkward title. I was helping a coworker with a problem,
where we wanted to ignore certain elements that didn't meet certain
requirements. We had a working template for the elements with requirements,
but how to make the processor ignore the others? My suggestion was to write
an empty template for the element (`item` below), with the paraphrased
explanation: "the processor with ignore the general expression but match on
the specific expression", but I'm clueless about the "why doesn't the
processor ignore all of the `item` elements, then?". I have the sense that
explanation might be approximately right, but it (and I) would benefit from
an improved understanding of what's actually happening.

Would someone be willing to share some better words to describe this? Is it
as easy as saying that since $expression-a (`item[discount]`) has a
predicate, it has a higher precedence than $expression-b (`item`) (or maybe
more simply: operator precedence - I see a note in Dr. Kay's XSLT/XPath 2.0
book about this)?

Thanks in advance for your time and trouble.
Best,
Bridger

Here's a contrived example of our source document:
<!-- source -->
<items>
  <item color="red" size="m">
    <price>15.00</price>
  </item>
  <item color="blue" size="m">
    <price>15.00</price>
    <discount percentage="20"/>
  </item>
  <item color="yellow" size="l">
    <price>15.00</price>
    <discount percentage="10"/>
  </item>
</items>

And a stylesheet:
<!-- xsl -->
<xsl:stylesheet xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
  xmlns:xs="http://www.w3.org/2001/XMLSchema"
  exclude-result-prefixes="xs"
  version="2.0">
  <xsl:output encoding="UTF-8" method="xml" indent="yes"/>
  <xsl:strip-space elements="*"/>

  <!-- identity transform -->
  <xsl:template match="@*|node()">
    <xsl:copy>
      <xsl:apply-templates select="@*|node()"/>
    </xsl:copy>
  </xsl:template>

  <xsl:template match="item[discount[@percentage ge '15']]">
    <discount-item color="{@color}" size="{@size}" price="{price}"
discount="{discount/@percentage}"/>
  </xsl:template>

  <xsl:template match="item"/>
</xsl:stylesheet>