Your results indicated that your xpath expresion was somethin like:
$currentPage//node
//node indicates to enumerate all nodes under currentPage entitled node regardless of the depth. In other words not just direct children.
To get direct children only then you use the xpath expression $currentPage/node
There are several ways to do what your after but tkahn is correct in that a recursive method would be the most effecient method to do this. Recursion can be accomplished within a template with either a match or name in combination with params but the most effecient is the match method. Basically:
<xsl:template match="node" mode="call-me">
<li><xsl:value-of select="@nodeName"/>
<xsl:if test="current()/node">
<ul>
<xsl:apply-templates select="current()/node" mode="call-me"/>
</ul>
</xsl:if>
</li>
</xsl:template>
If you asking why the if test current()/node (ergo does the current node have a child called node) its because if you do not you could end up with a dread <ul/> which really gets the browser a little up tight when it comes to rendering as it expect <ul></ul>
Hope this helps...
Cheers
Keith