$dom = new DOMDocument();
$dom->loadXML(xml_as_string);

$new_room = $dom->createElement('room', value);

$xpath = new DOMXPath($dom);
$nodeList = $xpath->query("/section/room[@id=X]");
$old_room = $nodeList->item(0);
$old_room->parentNode->replaceNode($new_room, $old_room);