This is a modification of a device I made to slit plastic trim down in width. It works the same way, just doesn't cut clear through the material being cut, in this case insulated wire. You can see all of the pictures on my Flickr site. I will only have a few in this instructable.
Once you've seen the Flickr photos you can see how the setup needs to be changed a little to strip wire. The main differences are the cutting depth and angle of the blade and the depth of the slot.
In this picture I illustrate four variables. A+B equals the diameter of the wire you are trying to slit. Adding the blade between them later on will provide enough play for the wire to pull through easily. C is the blade height. For trim, the height can be big because you are cutting clean through the trim. For wire the height is very low, the thickness of the insulation you are slitting. D is the slot depth. For trim slitting the slot shoud be deep to help hold the down force device in place and to protect your hands from the blade. For wire, the slot should be slightly less than the wire diameter. This way your down force device will make contact with the wire as you pull it through the slot.