I've checked it, and it turns out it's a limitation of the XML language service in VS.NET 2003 itself. Even with ViEmu disabled, the command doesn't work (while it works with other file types).
The only solution I can think of is a bit involved: it requires a ViEmu key mapping and a Visual Studio macro. I'm not a macro wizard, but I guess it's pretty easy to write a macro to comment the current selection. Let's say the macro is called "CommentXML" and is stored in MyMacros.Module1. The following mapping should make Control+Shift+C do what you want:
:vnoremap <c-s-c> gS:macro MyMacros.Module1.CommentXML<cr>
vnoremap makes the mapping only work in visual mode, 'gS' is the command to turn the current visual range in the Visual Studio selection and :macro calls a macro.
Ok, I bit the bullet, and here is my attempt at a CommentXML macro:
Dim sel As TextSelection = DTE.ActiveDocument.Selection
Dim Block As String = sel.Text()
Dim cmt As String
cmt = "<!--" + Block + "-->"
sel.Text() = cmt
It works, but it's not great (multiple undo steps, it deletes and re-inserts the text, etc...). I'm not familiar with the macro model, and I wasn't able to find a better solution - hopefully someone else can.
HTH and best regards,
PS: Of course, you can just map the macro directly to a keypress using VS, but if you want to use ViEmu's vim-like selection model, a mapping will work best as it will take care of converting the visual range into the selection