Yes, so long as what they generate ends up as part of an XML-conformant file (ie either valid or just well-formed).
Server-side tag-replacers like shtml, PHP, JSP, ASP, Zope, etc store almost-valid files using comments, Processing Instructions, or non-XML markup, which gets replaced at the point of service by text or XML markup (it is unclear why some of these systems use non-HTML/XML markup).