I just found a solution that worked for my situation.
On the form being merged with the xml data, select the field(s) you want to hide the null value for.
Then go into the 'Field' tab in the 'Object' palette, click on the patterns button.
In the Data tab click 'Allow empty' and in the text box below it type
null
This should hide any null values from being displayed as 'null' on the form. This also works for numeric fields and date/time fields.