render layout not working for application.xml.builder

I have layouts/application.xml.builder which is rendered for all xml reponses.
In controllers I have:

format.xml { render :layout => true, :xml => @some_var }

This works perfectly fine in rails 2.1.2 and stopped working after upgrading to 2.2.2.
It appears that :layout => true is not taking any effect. The @some_var.to_xml is rendered just not with
application.xl.builder any more. I googled around and tried a bunch of different approaches but
stuck. Anyone seen something like this?



Yes I have. I wrote a tiny app to illustrate my problem.

I have one model - user.rb:
class User < ActiveRecord::Base
  def name

and users_controller.rb:
class UsersController < ApplicationController
  def index
    respond_to do |format|
      format.xml do
        render :xml =>, :layout => 'application'

I defined routes for it: map.resources :users

Then I change this to vary rails' versions for testing:
RAILS_GEM_VERSION = '2.2.2' unless defined? RAILS_GEM_VERSION

Using :layout => 'application' or not doesn't matter. When I hit
I get this output:

Processing UsersController#index to xml (for at 2009-03-16
17:41:10) [GET]
  [4;36;1mSQL (0.3ms) [0;1mSET SQL_AUTO_IS_NULL=0
  [4;35;1mUser Columns (1.5ms) SHOW FIELDS FROM `users`
Rendering template within layouts/application
Completed in 34ms (View: 6, DB: 2) | 200 OK [http://localhost/

As you can see, it is renderin layouts/application.

I have defined views/layouts/application.xml.builder as such:

xml.response do
    xml << yield

And what I get is: