Your named template can do e.g.
Code:
<xsl:copy-of select="$varName"/>
and that way returns a result tree fragment. Then you need to use an extension function like exsl:node-set to turn the result tree fragment into a node-set e.g.
Code:
<xsl:variable name="v2">
<xsl:call-template name="t1"/>
</xsl:variable>
<xsl:for-each select="exsl:node-set($v2)//*">...</xsl:for-each>