What you could do is use QXmlStreamReader from the not yet released 4.3. It allows you to read XML data in a stream based way, meaning you can start to parse the data before the document is finished, i.e. updating on the fly. (See Incremental parsing)
On a different note:
I am not sure if your approach to run the tests in process is the ideal solution - tests can crash, and sometimes tests need application objects themselves. I am not sure that having two QApplication objects in an app works. Why don't you try launching the test using QProcess and processing the output of it using QXmlStreamReader?
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