GHC 6.5 does enhanced dependency analysis for recursive bindings, to 
maximise polymorphism based on type signatures.  (See Mark Jones's
THIH paper.)  

I didn't do the bindInstsOfLocalFuns part correctly though, and jhc
showed up the bug.  (It only matters when you have a recursive group
of two or more functions with a type signature, not at top level, which
is why it hasn't shown up till now.) 

Test is tc207.hs