Not quite. Looking a bit further down get_progname()'s weird logic, we see that it works like this:

1. prog = Py_GetProgramName()
2. progpath = GetModuleFileNameW()
3. if (prog is empty):
       prog = "python"
4. if (slash in prog):      # Or backslash, of course
       progpath = prog

So it uses the host process name from step 2 (i.e. progpath) whenever Py_SetProgramName() has not been used and step 3 has set prog to a value not containing a directory separator (or if it *has* been used to set something with no such separator in it).

The logic makes sense, I think, but it is quite impenetrable. Any chance of PEP 432 ("Restructuring the CPython startup sequence") happening this century?