XML ensures portability of data similar to Java, which ensures portability of code.

XML removes two constraints which were holding back Web developments:
1. dependence on a single, inflexible document type (HTML) which was being much abused for tasks it was never designed for;
2. the complexity of full SGML, whose syntax allows many powerful but hard-to-program options.
XML allows the flexible development of user-defined document types. It provides a robust, non-proprietary, persistent, and verifiable file format for the storage and transmission of text and data both on and off the Web; and it removes the more complex options of SGML, making it easier to program for.

Yes, provided you use up-to-date SGML software which knows about the WebSGML Adaptations TC to ISO 8879. An alternative is to use an SGML DTD to let you create a fully-normalised SGML file, but one which does not use empty elements; and then remove the DocType Declaration so it becomes a well-formed DTDless XML file. Most SGML tools now handle XML files well, and provide an option switch between the two standards.

TO make existing html files to xml you can convert them to conform to some new document type (with or without a DTD or Schema) and write a stylesheet to go with them; or edit them to conform to XHTML.
It is necessary to convert existing HTML files because XML does not permit end-tag minimisation (missing , etc), unquoted attribute values, and a number of other SGML shortcuts which have been normal in most HTML DTDs.