Summary form only given. Optical transport layers need rearrangeable wavelength-division multiplexing optical cross-connects (OXCs) to increase the capacity and flexibility of the network. It has previously been shown that a cross-connect based on all-optical wavelength converters for routing as well as wavelength slot interchanging can be used to create a robust and nonblocking OXC. However, for an OXC with n fiber inlets each carrying m wavelengths the OXC requires n/spl times/m internal wavelengths, which constrains the size of the cross-connect. In this paper we therefore propose and demonstrate an architecture that uses a reduced set of internal wavelengths without sacrificing cross-connecting capabilities. By inserting a partly equipped OXC with the new architecture in a 10-Gbit/s re-circulating loop setup we demonstrate the possibility of cascading up to ten OXCs. Furthermore, we investigate the regenerating effect of the OXC on signals that suffer from interferometric crosstalk.