This is in the release notes (relnotes/rnissues.htm#d0e1234):
And sure enough, ?item? is in the list of reserved names (see http://w3.org/TR/xquery/#id-reserved-fn-names). So your query should be:
for $b in input()/doc_root/:item
return $b
#webMethods#API-Management#webMethods-Tamino-XML-Server-APIs