Description:
------------
call to xslt_process() transforms non-breaking space incorrectly.  

Reproduce code:
---------------
$xslt = xslt_create();
$xmlFile = "/../data/pictures.xml";
$xslFile = "picturePage.xsl";
xslt_set_encoding($xslt, 'UTF-8');
	$parameters = array (
	  'linkKey' => $_GET['page']
	);
$transformed =  xslt_process($xslt, $xmlFile, $xslFile, NULL ,NULL, $parameters);
if ($transformed) {
	echo $transformed;
} else {
	echo "Error Transforming pictures.xml by applying picturePage.xslt into employee.html";
	echo "<BR>Error description " . xslt_error($xslt);
		echo "<BR>Error code  " . xslt_errno($xslt);
	}
	xslt_free($xslt);
<--------->
XSL:
<xsl:template match="picture" mode="link">
	<xsl:element name="a">
		<xsl:attribute name="class">RegLink</xsl:attribute>
		<xsl:attribute name="href">picture.html?picture=<xsl:value-of select="../@path"/>/<xsl:value-of select="@file"/></xsl:attribute>
		<xsl:apply-templates select="." mode="thumb"/>
	</xsl:element>&#160;
</xsl:template>



Expected result:
----------------
formatted transformation with non-breaking space between images.

Actual result:
--------------
transformation with "?" instead of non-breaking space.