User creation form, permissions, roles, tabs, and actions on admin/people are broken

I can confirm this too, on the latest dev version. I am looking into what's happening here now.

Hmmm, it seems that user.module is creating a menu item at admin/people, that is the actual user listings callback page you see, but also an empty tab that just acts as a default tab, with the callback being inherited from it's parent (admin/people). So if the view is admin/people/people we get our tab back ok, but can't see the view at admin/people only by going to admin/people/people...

That's odd. The System display handler should account for the default local task and any other local tasks already.

I wonder why this works for the admin/content view, but not for the admin/people view?

sun, yes, it's strange. They both have the same menu structure I think.....

confirming this issue, drupal 7.14.

additionally, if you try creating a custom page in ctools page manager, it won't let you.

admin/people
admin/people/people

and when i try to access admin/people/people, i get a not authorized error.

I've spent the past couple of hours to debug, analyze, and fix this bug. (Even though I don't have the pleasure to be able to use this module in any of my projects myself currently...)

Attached patch fixes the router item property inheritance and makes those pages work again.

Now with automated tests to prevent this from happening in the future.

Thanks for reporting, reviewing, and testing! Committed to 7.x-1.x.

A new development snapshot will be available within the next 12 hours. This improvement will be available in the next official release.