We had exactly the same issue. I'm not sure why it suddenly started happening with a particular project, but the solution for us was to add the xsi namespace to the top level of the original configuration file (ie the base file the transformations work on). So...
<configuration>
... would become...
<configuration xmlns:xsi="http://www.nlog-project.org/schemas/NLog.xsd">
This did the trick.
An alternative approach that also worked was to apply the transforms on child elements of the nlog element.
Hope that helps someone.