Just a shameless bump of my own post, since it hadn't received any responses. ;-)
Any thoughts would be much appreciated.
If the Seam contributors feel it's a bug, I'll enter in the JIRA.
I guess everybody is busy preparing for JavaOne. I had a similar issue few days back but didn't get much helpful replies either. You know what why dont you join me camp right next to JBoss booth in JavaOne and get all our seam issues resolved.