You should also add a template

<xsl:template match="doc">
 <doc>
  <xsl:copy-of select="@*"/>
  <xsl:apply-templates select="fragment"/>
 </doc>
</xsl:template>

to make sure that the current node list  when applying templates to
fragments does just consist of fragment elements so position()
goes 1 2 3  otherwise with the select="node()|@*" it would also include
white space text so the fragment elements would be in positions 2 4 6
and if the doc element had any attributes the position of the fragment
nodes in the node set returned by "node()|@* would be increased
accordingly.

regards,
--
Joris Gillis (http://www.ticalc.org/cgi-bin/acct-view.cgi?userid=38041)
"Et ipsa scientia potestas est"  - Francis Bacon , Meditationes sacrae