Thanks for the reply, Cheng.  Unfortunately, the example you provided with that link doesn't involve multiple xsd files - one xsd file including another via an <import> tag with a schemaLocation attribute.  The actual xsd and xml files we're using are a bit large and impracticle to share.  But here's a small example.  Consider the code...

    protected void Page_Load(object sender, EventArgs e)
    {
        FileStream fs = new FileStream(Server.MapPath("foo\\foo.xsd"), FileMode.Open);

        XmlSchema schema = XmlSchema.Read(fs, ValidationCallBack);

        XmlReaderSettings settings = new XmlReaderSettings();
        settings.Schemas.Add(schema);
        settings.ValidationType = ValidationType.Schema;
        settings.ValidationFlags |= XmlSchemaValidationFlags.ProcessSchemaLocation;
        settings.ValidationEventHandler += new ValidationEventHandler(ValidationCallBack);

        Response.Write(settings.Schemas.Count + "<br/>");

        string xml = "<?xml version=\"1.0\" encoding=\"UTF-8\"?><foobarx xmlns=\"http://curtisdehaven.com/bar\">HelloWorld</foobarx>";
        MemoryStream stream = new MemoryStream();
        StreamWriter writer = new StreamWriter(stream);
        writer.Write(xml);
        writer.Flush();
        stream.Position = 0;

        XmlReader xr = XmlReader.Create(stream, settings);

        while (xr.Read())
        {
            string s = xr.Name;
            Response.Write(s + "<br/>");
        }

        fs.Close();
    }

    private void ValidationCallBack(object sender, ValidationEventArgs args)
    {
        Response.Write("**** " + args.Message + "<br/>");
        return;
    }

And consider the following files...

foo\foo.xsd
<?xml version="1.0" encoding="UTF-8"?>
<schema xmlns="http://www.w3.org/2001/XMLSchema" xmlns:b="http://curtisdehaven.com/bar">
 <import namespace="http://curtisdehaven.com/bar" schemaLocation="./bar/bar.xsd"/>
</schema>

foo\bar\bar.xsd
<?xml version="1.0" encoding="UTF-8"?>
<schema xmlns="http://www.w3.org/2001/XMLSchema" targetNamespace="http://curtisdehaven.com/bar">
    <element name="foobar" type="string"/>
</schema>

If we run this code, we get the following output.  Note that it indicates only 1 schema present - the 1 should be a 2.  Also, it doesn't seem to care about the illegal xml element, <foobarx>.

1
xml
foobarx

foobarx

However, if we port that code to a C# console app with the exe in the same folder as foo.xsd, we get the expected output...

2

xml

**** The 'http://curtisdehaven.com/bar:foobarx' element is not declared.

foobarx

foobarx