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The assertion against the test results is incorrect. The actual results are not well-formed XML, and are: <new xmlns:sf="http://streamable-functions"> <p>Hello again.</p> </new> <new xmlns:sf="http://streamable-functions"> <p>Hello again.</p> <p>Hello again.</p> <p>Hello again.</p> </new>
Ran this in Saxon with streaming disabled and it produces the expected results. Bug withdrawn.