Это будет делать именно то, что вам нужно:
from xml.dom import minidom
doc = minidom.parseString(text)
for question in doc.getElementsByTagName('question'):
for answer in question.getElementsByTagName('answer'):
if answer.childNodes[0].nodeValue.strip() == '99':
question.parentNode.removeChild(question)
print doc.toxml()
Результат:
<html>
<body>
<questionaire>
<question>
<questiontext>
Do I love HTML/XML parsing?
</questiontext>
<questalter>
<choice>
1 oh god yeah
</choice>
<choice>
2 that makes me feel good
</choice>
<choice>
3 oh hmm noo
</choice>
<choice>
4 totally
</choice>
</questalter>
<answer>
4
</answer>
</question>
</questionaire>
</body>
</html>