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Can confirm this, as it breaks many things upstream like zc.buildout. Clamping the setuptools version to 25.1.1 reverts to old behavior. To be honest though I can't really see anything in the diff that would do this........ Thanks for taking a stab at it @jaraco
This reverts commit 8579495.
As we can see on pypa#709,
this breaks many things (easy_install C extensions, all py3.5 tests,
run with LANG=C).
So instead of fixing in a hurry all new bugs due to this, I propose to
revert this commit until all downsides of this change have been
Related bug: pypa#709
Related bug: pypa#710
Related bug: pypa#712