You may find The XML Diff and Patch GUI Tool (sample code on MSDN) meets your needs a little better: it still shows tags, but emphasizes the difference in text. Since you get the code, for a little more effort you could tailor it more precisely to your requirements.
Although the sample is relatively elderly (July 2004, and has its roots in 2002) it upgrades to Visual Studio Express C# 2008 painlessly. Don't be put off when downloading the sample from the MSDN site if/when the installer MSI mentions "SQLXML Bulkload in .NET Code Sample" - it's not!
