In short can I load an XML file that has an inline Schema into an Excel
document, if so can someone please post a sample, if not, can anyone tell me
why not?

We currently use Office 2003 and 2007 at my workplace and I have written web
app that has the ability to export query results to XML with the Schema
embedded in the same file for convenience.

I have achieved this using the .Net DataSet function:

myDataSet.WriteXml(dlgSave.FileName, XmlWriteMode.WriteSchema);