xml versus xhtml

Hi All,

I am beginning to believe that when there is a discrepancy between me and
Tidy, that Tidy is usually right.  That being said, I'll ask anyway:

When I tidy -

<h1>start of  heading
  <p>paragraph within</p>
        end of heading
</h1>

tidy returns

<h1>start of heading</h1>
<p>paragraph within</p>
<p>end of heading</p>

This seems consistent with earlier observed tidy behavior, namely that
xhtml1.0 dtd disallows <p> within <h1>. So tidy closes the <h1>, etc.  But I
didn't specify output-xhtml.  I specified output-xml.  Isn't the input to
tidy valid h1 'xml'?  If so, why does tidy seem to force compliance with the
xhtml dtd?

Thanks for your help.

Cordially,

Paul