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Actually, it depends on what modules you have installed, how you created your blocks, the theme you are using, and what code you use for your banners.
If I'd get off my lazy butt and fix a couple sloppy ASCII character issues I created and banner code issues, MyWebResource, which runs XOOPS 2.2.2 is fully XHTML 1.0 Transitional compliant (on the homepage). As soon as you start browsing the various third party modules, however, compliance cannot be assured.
The problem is that there are a ton of bright module developers around XOOPS, that really are not that great with HTML templates. They can make it work, but it's anyone's guess whether it will validate.
If you want your site to be 100% XHTML 1.0 Transitional and CSS 2.0 compliant, it is possible, but, you'll have to edit some third party module templates, some hard-coded module files, and you might even want to submit a report to the module's developers letting them know what you had to do to make the site compliant.
Just my two cents.
Insanity can be defined as "doing the same thing over and over and expecting different results."
Stupidity is not a crime. Therefore, you are free to go.