The parts WILL stay seperate. The stitch merely aligns them together. It's impossible for a Nurbs character to be entirely 1 mesh, because of the mathematics involved. That's why it's called "patch" modeling. If you want only 1 mesh, you'll have to convert to Polys or SubDs, and merge all the pieces together.

One thing you're going to want to try to keep control of is making sure your spans match. You don't want to have isoparms "deadend" such as the one your arrow is pointing to in the lower image. You want to try to keep everything flowing throughout all the patches. The only viable "deadend" isoparms would be the 4 in the corners of the arm. Another thing I might suggest is to make the hole for the arm to stitch into extend further into the mesh of the torso.

This is a fairly difficult procedure to get the hang of, so don't get down. I had to do it dozens of times over and over before grasping it.

Good luck!