I am going to interpret your question like this:
If an XML document contains the
string "<b>" (which would actually have appeared in escaped form in the document as "<b>"), how can I use XSLT to transform that text into the opening tag of a <b> element?
The alternative, that the document contains the string "<b>" (which would have appeared in escaped form in the document as "&lt;b&gt;"), and you want to remove one level of escaping to end up with the string "<b>" (which would appear in the result document in escaped form as "<b>"), seems unlikely.
The answer to my interpretation of the question is to use <xsl:value-of disable-output-escaping="yes">. This will work in most cases, I believe, although technically XSLT is not required to support that attribute. The reason for that is that it makes it possible to produce non-well-formed XML as the output of a transformation. But if you're just producing HTML it should be okay.