[xsl] Sibling axis and as="element()"

Given this XML:

<xsl:variable name="foo" as="element(foo)+">
 <foo/>
 <foo/>
 <foo/>
</xsl:variable>

and this bit of XSLT:

<xsl:for-each select="$foo">
 <xsl:value-of select="count(preceding-sibling::*)"/>
</xsl:for-each>

I get this result:

000

I seem to remember David C mentioning something about using
as="element()" means the elements are no longer siblings... but I
can't find anything about it now.

Is this the case?  Do parentless trees lose their axes?

thanks
andrew

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