[xml] Libxml2 disable-output-escaping ="yes" produces extra new-line ?

["Peter Schlaifer" <peter schlaifer gmail com>]

<xsl:stylesheet version="1.0"
xmlns:xsl="http://www.w3.org/1999/XSL/Transform";>
  <xsl:output method="text"/>
  <xsl:template match="/" >
 
<xsl:text>&lt;hello&gt;</xsl:text><xsl:text>goodbye</xsl:text>
    <xsl:text
disable-output-escaping="yes">&lt;hello&gt;</xsl:text><xsl:text>
goodbye</xsl:text>
  </xsl:template>
</xsl:stylesheet>

Produces this output:

 <?xml version="1.0"?>
 &lt;hello&gt;goodbye
 <hello>
 goodbye

This is killing me - any help would be appreciated.
Also, since the output method is "text", is there any way to
suppress the <?xml ... > processing instruction?

Thanks for your help and a great product.