master.xml

<data>
  <products>
    <entry id="01">
        <title>product 01</title>
    </entry>
    <entry id="02">
        <title>product 02</title>
    </entry>
    <entry id="03">
        <title>product 03</title>
    </entry>
    <entry id="04">
        <title>product 04</title>
    </entry>
    <entry id="05">
        <title>product 05</title>
    </entry>
    <entry id="06">
        <title>product 06</title>
    </entry>
    <entry id="07">
        <title>product 07</title>
    </entry>
    <entry id="08">
        <title>product 08</title>
    </entry>
    <entry id="09">
        <title>product 09</title>
    </entry>
    <entry id="10">
        <title>product 10</title>
    </entry>
    <entry id="11">
        <title>product 11</title>
    </entry>
    <entry id="12">
        <title>product 12</title>
    </entry>
</products>
</data>

master.xsl

<xsl:stylesheet xmlns:xsl="http://www.w3.org/1999/XSL/Transform" version="1.0">

  <xsl:output method="xml" indent="yes" />

  <xsl:template match="/">
    <xsl:apply-templates select="data/products"/>
  </xsl:template>
  
  <xsl:template match="products">
      <xsl:apply-templates select="entry[position() mod 3 = 1]" mode="row"/>
  </xsl:template>
  
  <xsl:template match="products/entry" mode="row">
    <div class="row">
      <xsl:apply-templates select=". | following-sibling::entry[position() &lt; 3]" mode="entry"/>
    </div>
  </xsl:template>
  
  <xsl:template match="products/entry" mode="entry">
    <div class="product">
    	<xsl:value-of select="title"/>
    </div>
  </xsl:template>

</xsl:stylesheet>