On Ubuntu 8.10 beta. xdg-open mangles mailto: urls. When passed mailto:email@nospam.com, xdg-open converts that to mailto:///email@nospam.com. When it reaches the email client, the send address is ///email@nospam.com.
This isn't a bug in xdg-open. It only happens if you're using GNOME. xdg-open simply calls gnome-open, which has the bug. See http://bugzilla.gnome.org/show_bug.cgi?id=559483
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