blame not working well?

I was having fun updating blame.c to use the built-in xdiff instead of spawning and reading from external GNU diff (it is currently in "next" branch). It seems to pass the trivial testsuite case but I noticed for example annotating Makefile, sha1_name.c, or blame.c in git.git repository seems to show quite bogus annotation. One extreme case is the Makefile; for all but one line is blamed for the very initial commit made by Linus X-<. One good news for me is that the version before this change has the same breakage. One bad news is this seems to have been broken for some time.

Bisecting indicates 2a0925be3512451834ec9a3e023f4cff23c1cfb7 is the first bad commit, but I do not see how the change can break it. I'll continue digging it, but if you have a chance, could you take a look, too?