Certainly that's possible. Just use an identity transform and handle <break> specially. Instead of copying it using <xsl:copy>, output any text you like:
<?xml version="1.0" encoding="UTF-8"?>
<xsl:stylesheet xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
version="2.0">
<xsl:template match="node()|@*">
<xsl:copy>
<xsl:apply-templates select="node()|@*"/>
</xsl:copy>
</xsl:template>
<xsl:template match="break">
<xsl:value-of select="' '"/>
</xsl:template>
</xsl:stylesheet>
I you want the literal output you can use disable-output-escaping, like
<?xml version="1.0" encoding="UTF-8"?>
<xsl:stylesheet xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
version="2.0">
<xsl:template match="node()|@*">
<xsl:copy>
<xsl:apply-templates select="node()|@*"/>
</xsl:copy>
</xsl:template>
<xsl:template match="break">
<xsl:value-of select="'&#10;'" disable-output-escaping="yes"/>
</xsl:template>
</xsl:stylesheet>
However, this is an optional feature and not guaranteed to be supported by any XSLT processor.