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Sorry for the delay on this.  I think I'm closing in on the
problem.  I've been using Tim O'Malley's timeoutsocket
module for quite awhile.  I noticed the same problem today
when using the new timeout feature in the socket module.
Libraries like xmlrpclib use makefile() to get a file object
to play with.  File objects don't play well with timeouts
because the socket is in non-blocking mode.  I think what
happens here is that the first line of HTTPResponse.
_read_status sets line to the empty string because of the
timeout setting.  Tracing through the code which follows
makes it clear that control will wind up in the HTTP/0.9
chunk of code.

Maybe it's worth adding a test for line == "" after the
readline() call:

        line = self.fp.readline()
        if self.debuglevel > 0:
            print "reply:", repr(line)
        if line == "":
            raise BadStatusLine(line)

That would distinguish an error reading from an 0.9 server
(which would return something with that first readline()
call).