> Can anyone confirm my understanding that in XSLT and XQuery I cannot create 
> a function with a variable number of arguments,

true, you can define signatures for any fixed number of arguments, or,
as you say, use a sequence.

concat is as it is for xpath1, but even for built in functions they
resisted the temptation to add this feature. So I seem to find myself
using  
max((a,b))
quite often....

David