Same issue. Over-the-top annoying to wake up with an hour of XSL work to go on a three week project to find an overnight machine update and no functioning XSL debugger (which frankly is the only reason I have a VS Pro license). I found this: https://sharepoint.stackexchange.com/questions/118317/loading-this-assembly-would-produce-a-different-grant-set-from-other-instances with a tip to set the LoaderOptimization value (DWORD, 1) at HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft.NETFramework

Relaunch VS and I can now run the debugger. I get an extra output that says "Warning: 'System.Data.SqlXml' is not loaded from the Native Image Cache. That affects accuracy of timing information." That likely tells us the Dll with the problem and possible fix (clear and reset the cache, which probably means fiddling with the ngen utility).

Someone else can pick up the cache angle and try to get this running without the LoaderOptimization flag.