I have a mostly working solution. I found three great test cases:

penisland
---------
pen island
penis land
pen is land
penis l and
pen is l and
penis l an d
pen is l an d

zatxtaz
-------
z at x ta z

xapenx
------
xa pen x
x ape nx
[download]

I get all but "xa pen x" at the moment — it prints "x a pen x" — and I haven't attempted sorting yet.