Nginx 1.2.3 Rewrite Issue

[Nginx User]

Wierd problem with Nginx 1.2.3 rewrites.

See http://pastie.org/4433865 and note Line 30. The arg is part of the
main url. Results in a 404 not found as the final url becomes
"/test/index.php?x2_SID=41efad7adffaa9d25967dc913919cbc0?x2_SID=41efad7adffaa9d25967dc913919cbc0"

Any cluees