data lost in xml after transformation

Using Oracle Database version 19.16 (but problem also identified in 21).

I'm encountering a problem that whitespace-only text nodes are lost after a transformation with xquery/xslt. Even while de xml contains xml:space="preserve" and the transformation doesnt touch the concerning text nodes.

Steps to reproduce:

1. Store xml (with whitespace-only text nodes) as xmltype (binary) in a table
   E.g. <p xml:space="preserve">This <b>is</b> <i>a</i> test.</p>
   (Note the space between "is" and "a".)
2. Retrieve the xml from the table
3. Transform the retrieved xml
   select xmlquery('
   copy $tmp := .
   modify ()
   return $tmp
   ' passing v_xmldata returning content