xsl:style-sheet: XSL (and entities) in IE5

Hi,
I am new to XSL and to stylesheets in general, but have SGML background.
I'm trying to present a TEI-style XML document using IE5 and a simple XSL
stylesheet. I'm not trying to re-order elements. I am having a couple of
problems. 
 -IE5 finds my stylesheet, no error message, but displays only a white
page. The first line in my document is:
<?XML:stylesheet href="trial-style.xsl" type="text/xsl"?>

-when I viewed the XML file in IE5 w/o a stylesheet, a new line began
following every entity. Since the document is in German, this is a big
problem. My entity decls are like the one following:
<!ENTITY s  "s">

If anyone can offer help- I'd be thrilled.
Thanks,
Cathy




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