Whats the point of not having the configuration contained in the web.config? If its because you don't want the web.config to grow large and unmanageble, you can let the user decide whether they want to use external include or not. If it's because you want
to be able to easily validate the scheme you should consider using the fullblown configuration api, which supports collections and items and where validation is provided for free by the framework.
Advantages of using web.config include
no need to maintain an xml-scheme file for validation
automatic handling of caching and changes to the config file
familarity to developers of using a "well known system"
the user can decide for them selves if they want to inlcude the config in web.config or an external file.
only disadvantage i can see is that changes to the config will restart the whole app, and not just reload the combine config, but that is kinda the expected behaviou anyway when changing configuration in .Net applications.