[xsl] cannot remove indentation [XSLT 1.0]

[pankaj.c@xxxxxxxxxxxxxxxxxx]

Hello,

I think I am going nuts. 

I am having 35-40 small big xslts, which are being imported/included to 
main stylesheet. While defining a new environment (precisely speaking item 
glossary as a root element [mostly the chapter is root element]), I 've 
encountered that I am not able to remove indentation i the output XML, 
even when I clearly mentioning in my stylesheet written separately to 
handle this glossary component. in fact all stylesheet have this below 
defined to them.

<xsl:strip-space elements="*"/>
<xsl:output encoding="UTF-8" indent="no" media-type="text/xml" 
method="xml"/> 

The input xml looks something like below:

<?xml version="1.0"?>
<glossary id="0012">
<child_elements>
........
........
.......
</child_elements>
</glossary>

Initially I thought I must have defined glossary somewhere else in bunch 
of stylesheets but do not see any such issues and keep getting indented 
out XML.

I am using xsltproc 1.0. Anybody suggest what might be wrong? 

TIA,
Pankaj