What if you use:
  
  <xsl:otherwise>
   &lt;/em&gt;<xsl:apply-templates/>&lt;em&gt;
  </xsl;otherwise>

  I'm not sure if you need to put the '&lt;/em&gt;' in <xsl:text> elements ?!?

xsl:text isn't needed for tha. with or without xsl:text that isn't wat
you want to do it just generates the characters < / e m which will
appear in the output just as you show then here with the < quoted.
There is a lot of difference between making an element node and making a
text node that has some text that has xml syntax.

David

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