SYMPTOM:
In this particular scenario, a customer may have an XQuery report that returns WebDAV folder resources. This can be implemented by following page 670 on in the 9.4.1 Advanced Reporting Guide. The report definition is provided on page 676 in the 9.4.1 Advanced Reporting Guide.
After following the instructions in the Advanced Reporting Guide and setting up a freeform XQuery report using the same definition as provided previously, the report would return data as expected. The contents of a test folder created for purposes of this technical note are shown here:

When running the report in Strategy Developer 9.4.1 Hotfix 2 or earlier, the report should be populated:

After applying Hotfix 3, the same report returns no data as shown here:

CAUSE:
This is a known issue in Strategy 9.4.1 Hotfix 3.
ACTION:
This issue was fixed in Strategy 9.4.1 Hotfix 5. Upgrade to take advantage of the fix.
WORKAROUND:
Remove Hotfix 3 and apply an earlier Hotfix on the local machine if running in 2-tier or the local machine and Intelligence Server machine if running in 3-tier.