This is an issue that recently came up for me while writing a new XSLT for some XML generated by an application with XTHML embedded using CDATA. Normally I've been able to use disable-escape-output to render the results correctly.
However, in Firefox, everything was being displayed as escaped (i.e. &) as opposed to rendering as expected, since Firefox tends to be my primary browser when developing this resulted me losing some time trying to figure out what I was doing wrong before finding Firefox Bug 98168 describing the issue.
Right now it looks like this issue is not slated to be implemented in Firefox and I've been reading through the bug's comments and it looks like the decision was made back in 2001. As such, I was hoping someone might be able to explain what the issue is and if it still applies now in 2009? Also, if this is never going to be fixed in Firefox, is there a workaround for it besides using another browser?