your input and output have identical nesting structure and you are
simply renaming the elements, so something like
<xsl:stylesheet version="2.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform">
<xsl:output indent="yes"/>
<xsl:strip-space elements="*"/>
<xsl:template match="list1|list2|list3|list4">
<xsl:element name="level{substring-after(name(),'list')}">
<xsl:apply-templates/>
</xsl:element>
</xsl:template>
<xsl:template match="litem">
<text>
<para>
<xsl:apply-templates/>
</para>
</text>
</xsl:template>
</xsl:stylesheet>
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