I discovered this investigating a bug report that python-cjson doesn't compile properly on Windows (http://pypi.python.org/pypi/python-cjson). Cjson's setup.py asks distutils to compile with the flag '-DMODULE_VERSION="1.0.5"', but distutils.spawn._nt_quote_args is not escaping the quotes correctly.

Specifically, the current behaviour is:
>>> distutils.spawn._nt_quote_args(['-DMODULE_VERSION="1.0.5"'])
['-DMODULE_VERSION="1.0.5"']

I expect the following:
>>> distutils.spawn._nt_quote_args(['-DMODULE_VERSION="1.0.5"'])
['"-DMODULE_VERSION=""1.0.5"""']

Not surprising, since that function contains a big comment:
    # XXX this doesn't seem very robust to me -- but if the Windows guys
    # say it'll work, I guess I'll have to accept it.  (What if an arg
    # contains quotes?  What other magic characters, other than spaces,
    # have to be escaped?  Is there an escaping mechanism other than
    # quoting?)

It only escapes spaces, and that's it. I've proposed a patch which escapes the following characters properly: "&()<>^| (as far as I can tell, these are the "reserved" characters on Windows).

Note: I did not escape * or ?, the wildcard characters. As far as I can tell, these only have special meaning on the command-line itself, and not when supplied to a program.

Alternatively, it could call subprocess.list2cmdline (but there seem to be issues with that: http://bugs.python.org/issue8972).