Is there a way to have a transformation scenario prompt the end user to open and select a file to transform with? Instead of having to open the file in oXygen first?

Hello,

There's no way to configure it to prompt for a file, but note that you don't have to open the file itself in an editor to transform it.
All you have to do is link the file or its parent folder In the Project view (Window > Show view > Project), then you can right click on the file from the Project view tree and pick Transform > Transform with... and pick your scenario.

Regards,
Adrian