something like the following (untested)
<xsl:template match="list">
<xsl:variable name="items" select="item"/>
<table>
<xsl:for-each select="$items[postion()<9]">
<xsl:variable name="y" select="position()"/>
<tr>
<xsl:for-each select="$items[postion()<9]">
<xsl:variable name="x" select="position()"/>
<td><xsl:variable name="c" select="count($items[(_at_)x=$x][@y=$y])"/>
<xsl:choose>
<xsl:when test="$c=0">& # 1 6 0 ;</xsl:when>
<xsl:otherwise><xsl:value-of select="$c"/></xsl:when>
</xsl:choose>
</td>
</xsl:fdor-each>
</tr>
</xsl:for-each>
</table>
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