A Solution: 1) Find an old bolt or drift punch of similar diameter but an inch or two longer than the sheared off bolt. If you can't find one in your junk drawer, the hardware store has cheap "grade 5" bolts that will do.
2) Drop the longer bolt/punch down the stem hole. It will stop when it reaches the wedge. Take your "BFH", "Forming Tool", hammer or whatever name you give your implement of distruction and whack the bolt until the wedge goes down a bit and releases from the stem quill. The stem will now come out of the steer tube. NOTE: If there's severe rust in the steer tube, which is very common, squirt some oil down the hole in the stem and down the outside of the stem so it will penetrate between the stem and the steer tube. If the stem won't come out, you'll have to wrestle with it until it does. Any damage or galling that occurs will happen to the stem (UGH!)
3) Once the stem is out, you can remove the headset and fork. If the wedge is stuck in the steer tube, you can pound the wedge back up and out of the fork by going through the hole in the bottom side of the steer tube. If you have a center or side pull brake, or reflector bracket mounted with a through bolt in the bottom of the stem, it'll have to be removed first as well.
4) After the stem and wedge have been removed from the fork, you may be able to remove the threaded, broken end of the old bolt from the wedge, clean it and the stem up and reuse them, if you can find a replacement bolt that will work OK.
Good Luck!
Bruce Schrader San Francisco
===== "Not all those that wander are lost." -J.R.R. Tolkien (1892-1973)