i18n using domain names (not path prefixes)

It seems most people make multilingual sites using a path prefix; we are going to put up separate domain names for every language - and this does not seem to work too well...

Our current setup has i18n, pathauto and path_redirect installed. When translating nodes, a proper path alias is only created for the last edited translation of a node. If I create a norwegian translation, the original english path is lost.

I guess there isn't implemented any support for this setup at all - I'm thinking of doing this job, but first I would like to know whether anyone is working on this, or any related issues, allready.

Does pathauto take the "current language" variable into account at all?