Sorting node attributes and keeping structure in XSLT

<xsl:stylesheet version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform">
<xsl:output method="xml" indent="yes"/>
<xsl:strip-space elements="*"/>

<!-- copy all other nodes -->
<xsl:template match="node() | @*">
    <xsl:copy>
        <xsl:apply-templates select="node() | @*"/>
    </xsl:copy>
</xsl:template>

<!-- find every list element which has a preceding non-list element -->
<xsl:template match="list[not(preceding-sibling::*[1][self::list])]">
        <!-- now walk recursive through all lists -->
        <xsl:apply-templates select="self::list" mode="recurse">
            <xsl:with-param name="level1_margin" select="@margin"/>
            <xsl:with-param name="level" select="1"/>
       </xsl:apply-templates>
</xsl:template>

<!-- remove other list elements, because they are recursive processed -->
<xsl:template match="list"/>

<!-- remove @margin from list -->
<xsl:template match="list/@margin"/>

<!-- go recursive through all following lists -->
<xsl:template match="list" mode="recurse">
    <xsl:param name="level1_margin" select="0"/>
    <xsl:param name="level" select="1"/>

    <xsl:variable name="nextStep" select="self::list/following-sibling::*[1][self::list]"/>

    <!-- create current list element with its level -->
    <xsl:apply-templates select="self::list" mode="create">
        <xsl:with-param name="level" select="$level"/>
    </xsl:apply-templates>

    <xsl:if test="$nextStep">
        <xsl:choose>
            <!-- new start margin/point for level 1 -->
            <xsl:when test="($nextStep/@margin &lt;= $level1_margin) or ($nextStep/@margin &lt; @margin and $level = 2)">
                <xsl:apply-templates select="$nextStep" mode="recurse">
                    <xsl:with-param name="level1_margin" select="$nextStep/@margin"/>
                    <xsl:with-param name="level" select="1"/>
                </xsl:apply-templates>
            </xsl:when>
            <!-- -1 -->
            <xsl:when test="$nextStep/@margin &lt; @margin and $level &gt; 1">
                <xsl:apply-templates select="$nextStep" mode="recurse">
                    <xsl:with-param name="level1_margin" select="$level1_margin"/>
                    <xsl:with-param name="level" select="$level - 1"/>
                </xsl:apply-templates>
            </xsl:when>
            <!-- +1 -->
            <xsl:when test="$nextStep/@margin &gt; @margin">
                <xsl:apply-templates select="$nextStep" mode="recurse">
                    <xsl:with-param name="level1_margin" select="$level1_margin"/>
                    <xsl:with-param name="level" select="$level + 1"/>
                </xsl:apply-templates>
            </xsl:when>
            <!-- +-0 -->
            <xsl:otherwise>
                <xsl:apply-templates select="$nextStep" mode="recurse">
                    <xsl:with-param name="level1_margin" select="$level1_margin"/>
                    <xsl:with-param name="level" select="$level"/>
                </xsl:apply-templates>
            </xsl:otherwise>
        </xsl:choose>
    </xsl:if>
</xsl:template>

<!-- create list element with level attribute -->
<xsl:template match="list" mode="create">
    <xsl:param name="level"/>
    <list>
        <xsl:attribute name="level">
            <xsl:value-of select="$level"/>
        </xsl:attribute>
        <xsl:apply-templates select="@*"/>
        <xsl:apply-templates/>
    </list>
</xsl:template>

</xsl:stylesheet>