Besides the technical issues involved with versioing of XML schemas, and the processing of versioned instance documents, there are a few situations that make it hard to implement versioning solutions.
In some cases, schemas and instance documents are owned and processed by the same set of applications, and hence the scheme owners don’t immediately recognize the need for versioning. A simpler and more attractive solution for them is to reuse the same schema for changes. This is not a technical problem. The challenge is to get everyone recognize the need for versioning.
Further, there may be a large of number of inter-related applications processing instance documents of a given schema. Updating each application to recognize a new version may mean changing a lot of code. This is not an uncommon situation. I agree that one could use schema extensibility points to address this issue, but extensions are short-term solutions.
