XML Notepad 2007
Three days ago Microsoft released a new version of XML Notepad. They fixed the bug in Vista installation and added some new features. Tree View is synchronized with Node Text View for quick editing of node names and values, drag/drop support for easy manipulation of the tree, instant XML schema validation and more.
Get it here:
Another great free app is the XPath Builder. It allows you to quickly create XPaths, and display results. Intellisense supported!!!