XSLT document() relative path resolving to IIS.exe - asp.net

Question

I have a .NET WebApi project with two files, both of which have been marked as embedded resources and are deployed with the application. The files are also both in the same directory in the deployed application:
./xsl/transform.xslt
./xsl/schema.xsd
The xslt file needs to load the xsd file via the document() function:
<xsl:template match="*[not(local-name() = document('schema.xsd')//xs:element/#name)]" />
<xsl:template match="#*[not(local-name() = document('schema.xsd')//xs:attribute/#name)]" />
Unfortunately, I'm getting an exception at runtime that indicates that the relative path being resolved is the program files directory for IIS and not the directory where transform.xslt is located:
{
"Message": "An error has occurred.",
"ExceptionMessage": "An error occurred while loading document 'schema.xsd'. See InnerException for a complete description of the error.",
"ExceptionType": "System.Xml.Xsl.XslTransformException",
"StackTrace": "<ommitted>"
"InnerException": {
"Message": "An error has occurred.",
"ExceptionMessage": "Could not find file 'C:\\Program Files (x86)\\IIS Express\\schema.xsd'.",
"ExceptionType": "System.IO.FileNotFoundException",
"StackTrace": "<omitted>"
}
}
I don't want to use an absolute path here because I don't want to become overly dependent on the environment the application is deployed into. Is there anyway to force the relative path source from the same directory that transform.xslt is deployed into at runtime?
For reference, the absolute path to the xslt file at runtime was:
C:\\MyFolder\\MyCode\\MyProject\\Web\\bin\\xsl\\transform.xslt
EDIT:
As requested, the following is (roughly) the code that is used to load the xslt from the manifest resource stream and run the transform. This code is unwrapped from several different custom packages to boil it down into core libraries, so don't worry about the stream management. I promise the real code is much safer:
XmlReader input = this.GetInput();
Stream ouput = new MemoryStream(4096);
Stream stream = typeof(ClassUsingTransform).Assembly.GetManifestResourceStream("transform.xslt");
MemoryStream mStream = new MemoryStream(stream.ToByteArray());
var navigator = new XPathDocument(mStream).CreateNavigator();
XslCompiledTransform processor = new XslCompiledTransform();
processor.Load(navigator, XsltSettings.TrustedXslt, new XmlUrlResolver());
processor.Transform(input, new XsltArgumentList(), output);
The XmlUrlResolver could not be unwrapped into builtins easily, but the type used inherited from XmlUrlResolver and didn't appear to modify any of the builtin settings. Most of the work done in the derived classes seemed to focus on performance optimizations. If anyone thinks the implementation here is important, I can try to unwrap that class a bit better.
The XsltArgumentList used was also a derived type, but the argument list is empty as far as I can tell.