XqueryLanguage is touted as the essential MiddleWare tool by its proponents. The news that VisualStudioWhidbey will not include the upcoming Xquery 2.0 spec led to an organized petition to change Redmond's plans.
According to the FAQ, developers on the JavaPlatform will have a set of API through JSR225. See http://www.stylusstudio.com/xquery/xquery_for_all_faq.html
MicrosoftCorporation appears to be committed to having XqueryLanguage through SqlServerYukon?. See http://sqljunkies.com/WebLog/mrys/archive/2005/04/26/12910.aspx
A mid 2005 DevX survey indicated high level of interest amongst developers for using this tool.
See http://www.xml.com/lpt/a/2005/03/02/xquery.html for an introduction to the language.