1. If your database doesn't do this for you, you'll have to do it yourself the good-ol' fashioned way (with code).
2. There's a directive that is used in the XML response which indicates to the client that it should transform the XML document instance. Use something akin to "< ?xml-stylesheet type="text/xsl" href="example.xsl" ?>" to do this (at the top of your XML response. Be sure you set the content type to whatever mime type xml is "text/xml" maybe?