> My work-around is:
> 
> <xsl:template match="text()">
> <xsl:value-of select="translate(., '&#xA;&#xD;', '  ')" />
> </xsl:template>

It's very unlikely that any &#xD; characters will be present in your XML,
they will only be there if they were actually written as character
references. Ordinary newlines are normalized to &#xA.
> 
> But the above (as far as I can tell) applies to all my data. 
> Do you have
> any suggestions on how I can get it to only apply to data within the
> <p>...</p> tags?
> 

Instead of match="text()", using match="p/text()" or match="p//text()"
depending which is required.

Michael Kay