You're going to want to use a combination of CROSS (or OUTER) APPLY to turn the multiple nodes inside of some of the hierarchies into a virtual table of sorts. Note - you want to structure the APPLY statement to land at the "top" of the subtrees you plan on iterating through.

Something like the follow (note I added a few ID columns for testing purposes):

declare @xml XML

set @xml='<output xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance" xsi:noNamespaceSchemaLocation="PublishPricingRule.xsd" scenario="PublishPricingRule" sourceSystem="Pricing" eventType="Persist" transactionID="2012-06-26T13:46:52.064">

<pricingRuleCollection id="1">

<pricingRule id="3" >

<pricingInstruction precedenceIndex="1314">

<hierarchyNodeInclusionQualifier precedenceIndex="1315">

<includedHierarchyNodes />

</hierarchyNodeInclusionQualifier>

<hierarchyNodeExclusionQualifier precedenceIndex="1316">

<excludedHierarchyNodes />

</hierarchyNodeExclusionQualifier>

<mediaInclusionQualifier />

<mediaExclusionQualifier />

<brandInclusionQualifier precedenceIndex="1317" />

<brandExclusionQualifier precedenceIndex="1318" />

<monetaryHurdleRangeQualifier precedenceIndex="1319">

<range lower="0.0" upper="9999.99" />

</monetaryHurdleRangeQualifier>

<shippingServiceInclusionQualifier precedenceIndex="1320">

<qualifyingShippingServices>

<qualifyingShippingService value="APO/FPO-Std" />

<qualifyingShippingService value="Catalog Desk Continental" />

<qualifyingShippingService value="Continental-Std" />

</qualifyingShippingServices>

</shippingServiceInclusionQualifier>

<creditCardInclusionQualifier precedenceIndex="1321">

<qualifyingCreditCards>

<qualifyingCreditCard name="Amex" />

<qualifyingCreditCard name="Visa" />

</qualifyingCreditCards>

</creditCardInclusionQualifier>

<directShipInclusionQualifier precedenceIndex="1322" />

<dropShipInclusionQualifier precedenceIndex="1323" />

<proportionalShippingFeeAdjuster adjustmentAmount="0.00" />

</pricingInstruction>

</pricingRule>

</pricingRuleCollection>

</output>'

select @xml

select r.value('(/output/@scenario)[1]','varchar(250)'),

r.value('(/output/pricingRuleCollection/@id)[1]','varchar(250)'),

r.value('(/output/pricingRuleCollection/pricingRule/@id)[1]','varchar(250)'),

r.value('(/output/pricingRuleCollection/pricingRule/pricingInstruction/@precedenceIndex)[1]','int')

,s.value('@value','varchar(100)')

from @xml.nodes('/') x(r)

cross apply r.nodes('output/pricingRuleCollection/pricingRule/pricingInstruction') l(h)

cross apply h.nodes('shippingServiceInclusionQualifier/qualifyingShippingServices/qualifyingShippingService') o(s)