Convert to XSLT Dataview Error: This web part does not have a valid XSLT stylesheet: Error: A name was started with an invalid character.

From SharePoint designer, when trying to convert a list view to  XSLT Dataview, it resulted with an error: This web part does not have a valid XSLT stylesheet: Error: A name was started with an invalid character.

Fix:

This happens when you try to convert a list view with the “Edit (link to edit item)” field. Remove that field from view and convert to XSLT Dataview again.

IF you must have the edit link, Just add a new column to the dataview and place this XSL.

<TD> 
<a href="https://sharepoint.com/sites/IT/YOUR-List-URL/Forms/EditForm.aspx?ID={@ID}">Edit</a> 
</TD>