Distutils should tell swig to create it's C wrapper file into the
temporary directory (eg. build/temp.linux-i686-2.5) and to write the
language specific files to the library directory (eg.
build/lib.linux-i686-2.5).

Rationale:
Without the language specific files, python swig extensions won't be
able to run, so they should definetly be distributed by distutils.
The wrapper files are build by-products and should therefore be in the
temporary directory, so they get cleaned up on "setup.py clean".

Can you provide a patch?

Without having it tested very much, the attached patch fixes this issue
for me.

Note that the language specific files can't be handled via py_modules
because this is processed before their generation.

I noticed that my patch did not work for absolute directory names and
adjusted the matching to fix this.

Same with issue1016626?

Except that the _wrap.c file would still be created at the wrong place,
yes, you're right.