My (pure) suspicion is that the use of document-uri, while processing a collection, fails, see https://www.saxonica.com/html/documentation12/functions/fn/document-uri.html for some explanation.
So instead of
<xsl:for-each select="collection(concat($xmldirpath, '?select=*.xml;recurse=yes'))">
<xsl:variable name="file" select="fn:ditafilepath(document-uri(.))"/>
I would try
<xsl:for-each select="collection(concat($xmldirpath, '?select=*.xml;recurse=yes'))">
<xsl:variable name="file" select="fn:ditafilepath(base-uri(.))"/>
or instead of collection I would use uri-collection and then use <xsl:variable name="file" select="fn:ditafilepath(.)"/> and process doc(.) e.g. with wrapping <xsl:for-each select="doc(.)"><xsl:result-document href="{$filePath}" method="xml" encoding="UTF-8" indent="no">..</xsl:result-document></xsl:for-each> or push doc(.) through a template with <xsl:apply-templates select="doc(.)"/> where you have <xsl:template match="/"><xsl:result-document href="{$filePath}" method="xml" encoding="UTF-8" indent="no">...</xsl:result-document></xsl:template>.
But I haven't run any code, the error might still result from some very different use of XSLT or the Python API. Only I think the XSLT as shown doesn't work in Saxon 12 with the known change for document-uri no longer working for documents in collections, whether it is SaxonC and the Python API or Saxon Java.
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