That's probably due to the code not being able to process your opml file. It's pretty strict, and when an error is encountered, it will revert to the default opml which is the output you see from the Solution Explorer.
Looking at your opml code, I can see that it might be valid OPML, but the FeedBrowser expects a certain format to be able to present it. Specific tags have specific attributes that allow the Tabs, Sections, and Items to be parsed and presented.
Here's a simple example that you can test by simply copying and pasting into the Custom OPML Text area, and chosing 'Custom OPML Text' radio button option.
<outline text="Favorite Blogs" type="none" category="Tab">
<outline text="DotNetNuke" type="none" category="Section">
<outline text="DNN Core Blogs" type="rss" category="Category/@@600px" xmlUrl="http://www.dotnetnuke.com/Community/Blogs/tabid/825/rssid/0/Default.aspx" />
<outline text="John Mitchell" type="rss" category="Category/@@600px" xmlUrl="http://blogs.snapsis.com/SyndicationService.asmx/GetRss" />
<outline text="Nina Meiers" type="rss" category="Category/@@600px" xmlUrl="http://blogs.ninameiers.com/SyndicationService.asmx/GetRss" />
<outline text="WizzoDawg aka iwonder" type="rss" category="Category/@@600px" xmlUrl="http://wizzodawg.blogspot.com/feeds/posts/default" />
</outline>
<outline text="ASP.Net" type="none" category="Section">
<outline text="Scott Gutheie" type="rss" category="Category/@@600px" xmlUrl="http://weblogs.asp.net/scottgu/rss.aspx" />
<outline text="Pete LaPage" type="rss" category="Category/@@600px" xmlUrl="http://blogs.msdn.com/petel/rss.xml" />
<outline text="Danny Chen" type="rss" category="Category/@@600px" xmlUrl="http://weblogs.asp.net/dannychen/archive/2006/03/07/439790.aspx" />
<outline text="VB Team" type="rss" category="Category/@@600px" xmlUrl="http://blogs.msdn.com/vbteam/rss.xml" />
</outline>
</outline>
Click update, and you will see how the code is parsed to show the TabName 'Favorite Blogs', with the Sections 'DotNetNuke, and 'ASP.Net', and under each section are the available item links. When you need to use more tabs, sections, and items, you'll need to create the OPML file which requires the essential OPML file tags like this example.
<?xml version="1.0" encoding="utf-8"?>
<opml version="2.0">
<head>
<title>WizzoDawg News</title>
<ownerName>WizzoDawg</ownerName>
<ownerEmail>info@hgworks.com</ownerEmail>
<docs>http://www.opml.org/spec2</docs>
</head>
<body>
<outline text="Around The Web" type="none" category="Tab">
<outline text="Reuters" type="none" category="Section">
<outline text="Reuter Top Stories" type="rss" category="Category/@@3000px" xmlUrl="http://feeds.reuters.com/reuters/topNews?format=xml" />
<outline text="Oddly Enough" type="rss" category="Category/@@3000px" xmlUrl="http://feeds.reuters.com/reuters/oddlyEnoughNews?format=xml" />
<outline text="Top Stories" type="rss" category="Category/@@3000px" xmlUrl="http://feeds.reuters.com/reuters/topNews?format=xml" />
<outline text="World News" type="rss" category="Category/@@3000px" xmlUrl="http://feeds.reuters.com/reuters/worldNews" />
</outline>
<outline text="Google" type="none" category="Section">
<outline text="Top Stories" type="rss" category="Category/@@3000px" xmlUrl="http://news.google.com/news?ned=us&topic=h&output=rss" />
<outline text="World News" type="rss" category="Category/@@3000px" xmlUrl="http://news.google.com/news?ned=us&topic=w&output=rss" />
</outline>
<outline text="NPR" type="none" category="Section">
<outline text="NPR Morning Edition" type="rss" category="Category/@@3000px" xmlUrl="http://www.npr.org/rss/rss.php?id=3" />
</outline>
<outline text="BBC" type="none" category="Section">
<outline text="Front Page" type="rss" category="Category/@@3000px" xmlUrl="http://newsrss.bbc.co.uk/rss/newsonline_uk_edition/front_page/rss.xml" />
<outline text="World" type="rss" category="Category/@@3000px" xmlUrl="http://newsrss.bbc.co.uk/rss/newsonline_uk_edition/world/rss.xml" />
<outline text="UK" type="rss" category="Category/@@3000px" xmlUrl="http://newsrss.bbc.co.uk/rss/newsonline_uk_edition/uk/rss.xml" />
</outline>
</outline>
</body>
</opml>
Set the radio button option to Custom OPML URL/File, and place the URL to your file in the text area for the Custom OPML URL/File. On my site, I place the file with the following url http://localhost/dnnv040505/WizzoDawgCustomNews.opml. This works for me, and though I've only used it on my local test machine, it should work on a public site as well. Just modify your code and settings to follow the example, and you should be in the works. Now, the other caution is to remember that any illegal characters in your tags will result in your opml not being parsed and presented. That's a very important part in specifying the URL, remember that the ampersand character needs to be specified as & , and an apostrophe in the title is a no-no.
Let me know how it goes, and where I can see your efforts.
Cheers