Team Build 2010 And Web.config Transformation?

I'm struggling to get web.config transformations working with automated builds. We have a reasonably large solution, containing one ASP.NET web application and eight class libraries. We have three developers working on the project and, up to now, each has "published" the solution to a local folder then used file copy to deploy to a test server. I'm trying to put an automated build/deploy solution in place using TFS 2010. I created a build definition and added a call to msdeploy.exe in the build process template, to get the application deployed to the test server. So far, so good!

I then tried to implement web.config transforms and I just can't get them to work. If I build and publish locally on my PC, the "publish" folder has the correct, transformed web.config file. Using team build, the transformation just does not happen, and I just have the base web.config file. I tried adding a post-build step in the web application's project file, as others have suggested, similar to:

<target name="AfterBuild">
<TransformXml Source="Web.generic.config"
Transform="$(ProjectConfigTransformFileName)"
Destination="Web.Config" />
</target>

but this fails beacuse the source web.config file has an "applicationSettings" section. I get the error Could not find schema information for the element 'applicationSettings'.I've seen suggstions around adding arguments to the MSBuild task in the build definition like

/t:TransformWebConfig /p:Configuration=Debug

But this falls over when the class library projects are built, presumably because they don't have a web.config file.