In the error message I found a fragment:
This name reminds me of a previous discussion years ago:
I guess, you have some version conflict on XML processing libraries.
I guess, in the classpath in the azure pipeline, you have some jar file(s) that causes this error.
I just guess (I am not very sure), you might have a newer version of Apache Xercess (XML Parser) in the azure classpath which has the higher precedene to the Xercess jar bundled in Katalon Studio. Katalon Studio v8.6.x bundles very old version of Apache POI library, which is quite likely causes version conflicts with newer version of external libs like Xerces.
It is impossible for me to investigate further a problem caused by jar’s version conflict remotely.
If my guess is right, I think you would not be able to use Excel as data file for Katalon Tests in the Azure pipeline. Alternatively you could convert the Excel into CSV text manually. You want to use the CSV as input source for Katalon tests. Processing CSV would not involve any XML libraries. You would be able to workaround the original error.
I myself have a doubt about my guess above.
I assumed that the process of Katalon Runtime Engine and the process of Azure Pipeline both run in a single Java VM sharing a single classpath.
This is unlikely. If this is the case, it’s too stupid.
I guess Azure pipeline should be able to fork a dedicated process for Katalon Runtime Engine so that no collision of jar versions should occur.