Using XML will be feasible or not ?

I am developing a site which shows list of businesses in a particular city.The steps are actually like this...the user first selects a city , then a category and then a subcategory.All the businesses in that subcategory are displayed to the user.
The problem is that my client also wants it in CD.In CD ASP pages wont work....So can XML be used for that purpose ? We'll store all data in XML files and then use XML and XSL to display all the listings .
Its very similar to Yellow Pages Listings.The data is going to be huge in size.So is it feasible to use XML in this case ?

Thanks echalalio for the information...i'll try looking for other solution.But still i want to know one thing from you...how can we pass querystring variables from one xml document to other ?
for example...

<a href="subcat.xml?subcatid=1">Category1</a>

How can i retrieve subcatid in subcat.xml ? Is it possible ?

Or you can use ActiveSite Compiler (http://www.intorel.com/sitecomp/) and run your ASP files from the cd.