Index: pym/portage.py
===================================================================
--- pym/portage.py	(revision 5050)
+++ pym/portage.py	(working copy)
@@ -3475,6 +3475,49 @@
 				newsplit.append(x)
 	return newsplit
 
+def expand_new_virtuals(mysplit, mydbapi, mysettings, use, mode, myuse,
+	use_cache, use_binaries, myroot, trees, return_all_deps):
+	""" Recursively expand new-style virtuals so as to
+	collapse one or more levels of indirection."""
+	newsplit = []
+	dep_keys = ["RDEPEND","DEPEND","PDEPEND"]
+	def compare_pkgs(a, b):
+		return pkgcmp(b[1], a[1])
+	portdb = trees[myroot]["porttree"].dbapi
+	for x in mysplit:
+		if type(x) == types.ListType:
+			newsplit.append(expand_new_virtuals(x, mydbapi, mysettings, use,
+				mode, myuse, use_cache, use_binaries, myroot, trees,
+				return_all_deps))
+			continue
+		elif x.startswith("!"):
+			newsplit.append(x)
+			continue
+		elif not dep_getkey(x).startswith("virtual/"):
+			newsplit.append(x)
+			continue
+		pkgs = []
+		for cpv in portdb.match(x):
+			# only use new-style matches
+			if cpv.startswith("virtual/"):
+				pkgs.append((cpv, pkgsplit(cpv)))
+		if not pkgs:
+			newsplit.append(x)
+			continue
+		pkgs.sort(compare_pkgs) # Prefer higher versions.
+		a = ['||']
+		for y in pkgs:
+			depstring = " ".join(portdb.aux_get(y[0], dep_keys))
+			mycheck = dep_check(depstring, mydbapi, mysettings, use=use,
+				mode=mode, myuse=myuse, use_cache=use_cache,
+				use_binaries=use_binaries, myroot=myroot, trees=trees,
+				return_all_deps=return_all_deps)
+			if not mycheck[0]:
+				raise portage_exception.ParseError(mycheck[1])
+			a.append(mycheck[1])
+		newsplit.append(a)
+	return newsplit
+
 def dep_eval(deplist):
 	if not deplist:
 		return 1
@@ -3688,6 +3731,12 @@
 	elif mysplit==[]:
 		#dependencies were reduced to nothing
 		return [1,[]]
+
+	# Recursively expand new-style virtuals so as to
+	# collapse one or more levels of indirection.
+	mysplit = expand_new_virtuals(mysplit, mydbapi, mysettings, use, mode,
+		myuse, use_cache, use_binaries, myroot, trees, return_all_deps)
+
 	mysplit2=mysplit[:]
 	mysplit2=dep_wordreduce(mysplit2,mysettings,mydbapi,mode,use_cache=use_cache)
 	if mysplit2 is None: