Doru-

>Not at all obvious - I had no idea about the AppDomain class.

>From what I see in the help, you need to create an AppDomainSetup object and set its properties, including some ConfigurationFile, and then use it to create the AppDomain object. I'm afraid I'll end up in the same place, i.e. not knowing the required syntax for paths and directories. I'll have to try it.

I'm not getting that same sense of the docs. It seems to come along for free so far as I can tell. Try the following console app:

using System;

namespace ConsoleApplication2
{
	/// <summary>
	/// Summary description for Class1.
	/// </summary>
	class Class1
	{
		/// <summary>
		/// The main entry point for the application.
		/// </summary>
		[STAThread]
		static void Main(string[] args)
		{
			Console.WriteLine(AppDomain.CurrentDomain.BaseDirectory);
			Console.ReadLine();
		}
	}
}

>I'm starting to think that nobody ever wrote to an XML file in an SDE app...

This is where I feel so uncertain. It doesn't seem to me to be an XML or SDE issue, but one of how you locate files in the context of the application.