I didn't transfer any courses in when I enrolled in Excelsior, but I believe the way it works is...
You can transfer in credits from the school you attended. I believe that in order to transfer in a course, it must have a minimum grade attached to it, which I think is a "C". Otherwise it's discarded.
Excelsior has a policy of non-duplication. If you, for example, complete a class (either transferred or at Excelsior itself) in Macroeconomics and obtain a B; then take the Macroeconomics CLEP and obtain a C, you're duplicating credits and they won't accept both. As far as which you get to keep, the B or the C, I'm not sure, they don't go into detail about this. Excelsior's policy on this matter is:
If you complete more than one examination or course in the same subject, it will be considered duplication of credit and only one such examination or course will apply toward an Excelsior College degree.
I'm trying to find documentation that backs up what I'm saying, but I can't just now. I just recall reading about this when I was considering starting this program. I hope someone with experience in this area can provide more details.