Sidebars – No more lists?

Hi there,
Working on a site where I use this sort of markup to define the sidebar;

<h2>Recent Updates</h2>
      <h3>New Look</h3>
      As you will likely notice the site has a new look. <a href="#">More…</a>

      <h3>New Focus</h3>
      The site's focus has changed slightly. <a href="#">More…</a>

So I was transferring my page design into a WP theme, and I read that to make sidebars without lists I use

<?php if ( !function_exists('dynamic_sidebar')
        || !dynamic_sidebar() ) : ?>

in my sidebar, and I have a functions.php with this code;

<?php
if ( function_exists('register_sidebar') )
    register_sidebar(array(
    'before_widget' => '<div id="%1$s" class="widget %2$s">',
    'after_widget' => '</div>',
    'before_title' => '<h2 class="title">',
    'after_title' => '</h2>',
    ));
?>

However, this does not remove the lists as I expected. Here is how the code outputs in browser;

<div id="recent-posts" class="widget widget_recent_entries">
<h2 class="title">Recent Posts</h2>
<ul>
<li><a href="http://www.mypagehehe.com/archives/2009/04/03/hello-world/">Hello world! </a></li>
</ul>
</div><div id="tag_cloud" class="widget widget_tag_cloud"><h2 class="title">Tags</h2></div>
<li id="linkcat-2" class="linkcat"><h2>Blogroll</h2>
<ul>
<li><a href="http://wordpress.org/development/">Development Blog</a></li>
<li><a href="http://codex.wordpress.org/">Documentation</a></li>
<li><a href="http://wordpress.org/extend/plugins/">Plugins</a></li>
<li><a href="http://wordpress.org/extend/ideas/">Suggest Ideas</a></li>
<li><a href="http://wordpress.org/support/">Support Forum</a></li>
<li><a href="http://wordpress.org/extend/themes/">Themes</a></li>
<li><a href="http://planet.wordpress.org/">WordPress Planet</a></li>
</ul>

Is it possible to remove these darn lists completely? I’ve looked but am still at a loss. The titles are coming out as H2 tags, as I hoped, but the thing (the API?) is still wrapping each link into a list item.

Any help greatly appreciated.