Different approach of preserving the selection (doesn't modify the dom)
Takes all text nodes in the selection and saves the selection position in the first and last one
function(method) {
      var range = this.getRange(),
          body  = this.doc.body,
          newRange,
          firstNode,
          lastNode,
          textNodes,
          rangeBackup;

      // Nothing selected, execute and say goodbye
      if (!range) {
        method(body, body);
        return;
      }

      textNodes = range.getNodes([3]);
      firstNode = textNodes[0] || range.startContainer;
      lastNode  = textNodes[textNodes.length - 1] || range.endContainer;

      rangeBackup = {
        collapsed:      range.collapsed,
        startContainer: firstNode,
        startOffset:    firstNode === range.startContainer ? range.startOffset : 0,
        endContainer:   lastNode,
        endOffset:      lastNode === range.endContainer ? range.endOffset : lastNode.length
      };

      try {
        method(range.startContainer, range.endContainer);
      } catch(e) {
        setTimeout(function() { throw e; }, 0);
      }

      newRange = rangy.createRange(this.doc);
      try { newRange.setStart(rangeBackup.startContainer, rangeBackup.startOffset); } catch(e1) {}
      try { newRange.setEnd(rangeBackup.endContainer, rangeBackup.endOffset); } catch(e2) {}
      try { this.setSelection(newRange); } catch(e3) {}
    }