> I believe with xslt 2.0 you can specify an output method of 
> xhtml

yes

> - but with 
> xslt 1.0  I am not sure if there is any commonly accepted way 
> to do this 

There's no standard way to do it in XSLT 1.0. Some processors offer suitable
extensions.

On the other hand, I wonder whether there is really a need to do it? If the
receiving application is a browser, you might as well generate HTML. If the
receiving application requires XML, then generate XML: the special
serialization tweaks used in XHTML are needed only for browsers designed to
handle HTML.

Michael Kay
http://www.saxonica.com/