Here's some further update to XSD 1.1 feature implementation in Xerces-J.
Another significant feature, that's been added in XSD language (in, 1.1 version) is Open contents. It's defined on XSD complex types, and also at the schema level. A nice explanation about XSD 1.1 Open contents, is available in an article at, http://www.ibm.com/developerworks/xml/library/x-xml11pt3/index.html#N1034D.
The wild-card instruction xs:any in XSD 1.0 was a way to implement XSD Open contents. XSD 1.1 introduces two new instructions, for implementing open contents namely, <xs:openContent> and <xs:defaultOpenContent>. These new XSD instructions have more options for the XSD schema authors, to write open schemas.
I've been able to test couple of Open content examples, with current Xerces-J SVN code base, and Xerces-J implements them, sufficiently fine.