Vinay, your example with communicate only works because you removed the [:-1].  If you run your version against a debug build, the tests will fail.

I'm updating the patch with a version that works with both a non-debug and a debug build, and adds an additional test that shows that the chained full traceback fails even if the exception handler is not at the top level.  Tomorrow I'll post a request for help to python-dev, since I've nowhere near the knowledge of the CPython internals needed to figure out what is going on here.  (It is possible the traceback is in fact correct, but if so it is certainly unexpected and makes allframes a bit less useful.)