2.6 Blank WP_SITEURL & Virtual Hosts

Has anyone else found that using the blank value for WP_SITEURL method to force wordpress into using relative paths no longer works as it once did, since updating to 2.6?

I’m using virtual hosts and wonder if that is why instead of viewing my 127.0.0.1:8080 pages with glorious relative paths, I instead get a redirect to 127.0.0.1 which results in a 404 Not Found message.

Anybody have suggestions to fix this?