Another take on the tolerant truncate utility.

atomised-truncate.xsl

<?xml version="1.0" encoding="UTF-8"?>
<xsl:stylesheet version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform">

<!--
	Author: Neil Albrock
	Version: 1.0
	Description: Truncate by a character limit and retain HTML content.
	Usage: 
    	<xsl:call-template name="truncate">
	        <xsl:with-param name="data" select="path/to/your/body" />
	        <xsl:with-param name="length" select="250" />
			<xsl:with-param name="link" select="'href'" />
	    </xsl:call-template>
-->

<xsl:template name="truncate">
	
    <!-- The node set to be worked on. -->
    <xsl:param name="data"/>
    <!-- The desired truncate length. Default to length of data. -->
    <xsl:param name="length" select="string-length($data)"/>
	<!-- More link -->
	<xsl:param name="link"/>
	
	<xsl:choose>
		<!-- Return whole data if it's within length. -->
		<xsl:when test="string-length($data) &lt;= $length">
			<xsl:copy-of select="$data" />
		</xsl:when>
		<!-- Truncate to desired length. -->
		<xsl:otherwise>
			<xsl:for-each select="$data/*">
				<xsl:variable name="this-node" select="string-length(.)"/>
				<xsl:variable name="preceding-nodes">
					<xsl:copy-of select="preceding-sibling::*"/>
				</xsl:variable>
				<xsl:variable name="node-sum" select="string-length(normalize-space($preceding-nodes))"/>
				<xsl:variable name="limit" select="$node-sum + $this-node"/>
				
				<xsl:choose>
					<xsl:when test="$limit &gt; $length and $node-sum &lt;= $length">
						<p>
						<xsl:value-of select="substring(.,1,$length - $node-sum)"/>
						<xsl:text>&#8230;</xsl:text>
						<a>
							<xsl:attribute name="href">
								<xsl:value-of select="$link"/>
							</xsl:attribute>
							<xsl:text>more</xsl:text>
						</a>
						</p>
					</xsl:when>
					<xsl:when test="$limit &lt; $length">
						<xsl:copy-of select="."/>
					</xsl:when>
					<xsl:otherwise/>
				</xsl:choose>
				
			</xsl:for-each>
		</xsl:otherwise>
	</xsl:choose>
	
</xsl:template>

</xsl:stylesheet>