I'm not even sure what XHTML is, although it is 1.0 and likely to change, perhaps drastically, before it is fully formalized. Documents written in HTML 4.01 (what I generally recommend) can still use xml though, so XHTML isn't required for that. It's just that many view XHTML as somehow superior to, or 'ahead of' HTML, which it isn't. This causes many folks, including the developers of various CMS systems to use it when it isn't required, and it can cause problems.
You are right about the nifty script adding the nifty stylesheet. It does so here:
particularly in the highlighted area. Most likely if you were to remove or comment out that area, it would still work fine, as long as the stylesheet were still associated with the page via either a hard coded stylesheet link or via being hard coded in the head.