The <!DOCTYPE> declaration has to be present in a message if DTD validation is used. The validation uses DTD declared in the message. It doesn't use DTD/DTDs declared in the switchyard.xml. So, the 'Schema Files' are useless in the editor. The same applies for 'Catalog Files' and 'Namespace Aware', because DTD doesn't use namespaces. Also validate_1_1.xsd should be adjusted with regard to the changes.
The 'Schema Files' would be useful only if DTD validation used them.