I just migrated from 9.2.4 to 9.6.1 and had several user created functions fail.
Recreating the failure with "SELECT xmlelement(name foo, 'infinity'::timestamp) ERROR: timestamp out of range DETAIL: XML does not support infinite timestamp values.
I don't find anything in the documentation that explains this. I consider this a regression.
Actually, the cause of said commit (circa 2009) is that xmlelements were failing but xmlattributes were not...which makes me wonder how a 9.2 era release (circa 2012) supposedly worked with the submitted expression.
The basic answer is that the XML data type is defined by standard and we attempt to conform to the standard. In order to do so we must disallow infinite timestamps even though we accept them in SQL.
I just tested the OP query on 9.0.x and 9.4.x and get the same error on both.
There'd be a bit more sympathy if the OP were complaining about a patch release changing behavior - bug fix or not - but since the complaint involves going from 9.2 to 9.6 on its face this is an allowed behavior change regardless of the history.
However, feel free to make a straight argument for accepting infinite timestamps and thus go above-and-beyond the relevant standards. Personally this seems like a not-so-useful restriction on our implementation. Let the user decide whether they want to deviate from the standard and risk cross-system incompatibilities. XML itself is textual and we don't have any internal support for DTD or Schema as it is so I'm not sure what material benefit we gain by restraining ourselves here.
