I can't reproduce this issue on Windows, at least.
Have you double-checked your CLASSPATH or tried using Saxon instead of Xalan? I actually thought DITA-OT dropped support for Xalan when all XSLT stylesheets were converted to XSLT 2.0.
EDIT: Ah, my bad. The XSLT 2.0 commits are not included in the 1.8 release.