XSLT can transform your XML to HTML that then a browser like Internet Explorer or Firefox can render. HTML has form controls like checkboxes so you can have that in the transformation result. However if you want to save data in a HTML form then the browser usually submits data over HTTP to a server where it is processed with PHP or ASP. Saving data locally from a browser is usually difficult or not possible as even script inside the HTML document does not have access to the file system, for security reasons.

One Windows you could consider writing a HTA (HTML application), that is basically a HTML document with script that is run outside of the browser's sandbox so that you have access to the file system.

Then there are solutions like XForms although I don't know how good they are at local file edits, like HTML forms they are mainly meant to submit data to a server.

So I have mentioned some options, but the short answer to your question if XSLT alone is enough to update a local XML file based on user input is no in my view.

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Martin Honnen
Microsoft MVP - XML
My blog