So, what I need is something like:

xxxxxxxxxxxxx

<ul>
 <li>home</li>
 <ul>
   <li>products</li>
   <ul>
     <li>wig</li>
     <ul>
       <li>wig tool</li>
     </ul>
   </ul>
 </ul>
 <ul>
   <li>faq</li>
 </ul>
</ul>

<xsl:template match="page">
  <li>
    <xsl:value-of select="@name"/>
  </li>
<!-- check for page children -->
  <xsl:if test="page">
    <li>
      <ul>
        <xsl:apply-templates select="page"/>
      </ul>
    </li>
  </xsl:if>
</xsl:template>

best,
-Rob