<xsl:stylesheet version="1.0"
xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
xmlns:fn="http://www.w3.org/2005/xpath-functions">
You have to add the namespace declaration for the prefix dme. Also a little addition of an attribute exclude-result-prefixes may help to obtain a cleaner output.
ps: Unless you are engaging in some template using xpath-function namespace, you do not need the xmlns:fn part here. And even so, xslt version 1.0 strict won't support it. But this really is a side-note as far as your question is concerned.