However, the color and style instructions (\ss\tfa) have no effect. I tried to solve that, as a first step, by putting \ss before the \xmlall instruction:
\startxmlsetups xlm:contact \setlayer[AddressBg] {\framed[width=55mm,height=30mm, align=right,background=color, backgroundcolor=lightgray]{\ss\xmlall{#1}{/address}}} \strut ... \stopxmlsetups
This works (see pdf), but there are probably other and better ways.
Have a look at the framed/setupframed command; they have foregroundstyle and foregroundcolor keys; that would be the most idiomatic way to set the style.
Another persisting problem is that the commands are still not ‘expanded’ (see Pablo’s remarks). According to Pablo for some reason there is only one expansion level.
This means that after an \input command, all other commands are not expanded (see pdf).
This also applies to your suggestions (see pdf brieven2mkiv5.pdf): in the Knuth sample text the only command \TeX\, is not expanded either.
You’re working within xml setups, which means that the catcodes are not the same as in TeX, which means that the backslash is just a normal character. The question is: why would you need TeX commands from an external file? Is this where your letter text comes from? You keep us guessing and are not describing what your needs are. Thomas