diff --git a/CLasH/Normalize.hs b/CLasH/Normalize.hs
--- a/CLasH/Normalize.hs
+++ b/CLasH/Normalize.hs
@@ -216,10 +216,15 @@
 -- body consisting of a bunch of nested lambdas containing a
 -- non-function value (e.g., a complete application).
 eta :: Transform
-eta c expr | is_fun expr && not (is_lam expr) && all (== LambdaBody) c = do
-  let arg_ty = (fst . Type.splitFunTy . CoreUtils.exprType) expr
-  id <- Trans.lift $ mkInternalVar "param" arg_ty
-  change (Lam id (App expr (Var id)))
+eta (AppFirst:_) expr = return expr
+-- Also don't apply to arguments, since this can cause loops with
+-- funextract. This isn't the proper solution, but due to an
+-- implementation bug in notappargs, this is how it used to work so far.
+eta (AppSecond:_) expr = return expr
+eta c expr | is_fun expr && not (is_lam expr) = do
+ let arg_ty = (fst . Type.splitFunTy . CoreUtils.exprType) expr
+ id <- Trans.lift $ mkInternalVar "param" arg_ty
+ change (Lam id (App expr (Var id)))
 -- Leave all other expressions unchanged
 eta c e = return e
 
@@ -947,7 +952,7 @@
 -- What transforms to run?
 transforms = [ ("inlinedict", inlinedict)
              , ("inlinetoplevel", inlinetoplevel)
-             , ("inlinenonrepresult", inlinenonrepresult)
+             -- , ("inlinenonrepresult", inlinenonrepresult)
              , ("knowncase", knowncase)
              , ("classopresolution", classopresolution)
              , ("argprop", argprop)
diff --git a/Setup.hs b/Setup.hs
deleted file mode 100644
--- a/Setup.hs
+++ /dev/null
@@ -1,2 +0,0 @@
-import Distribution.Simple
-main = defaultMain
diff --git a/Setup.lhs b/Setup.lhs
new file mode 100644
--- /dev/null
+++ b/Setup.lhs
@@ -0,0 +1,3 @@
+#!/usr/bin/env runhaskell
+> import Distribution.Simple
+> main = defaultMain
diff --git a/clash.cabal b/clash.cabal
--- a/clash.cabal
+++ b/clash.cabal
@@ -1,5 +1,5 @@
 name:               clash
-version:            0.1
+version:            0.1.0.1
 build-type:         Simple
 synopsis:           CAES Language for Synchronous Hardware (CLaSH)
 description:        CLaSH is a tool-chain/language to translate subsets of
@@ -19,11 +19,11 @@
 Cabal-Version:      >= 1.2
 
 Library
-  build-depends:    ghc >= 6.12, pretty, vhdl > 0.1, haskell98, syb,
-                    data-accessor, containers, base >= 4 && < 5, transformers,
-                    filepath, template-haskell, data-accessor-template,
-                    data-accessor-transformers, prettyclass, directory, 
-                    tfp, th-lift, time
+  build-depends:    ghc >= 6.12 && < 6.13, pretty, vhdl > 0.1, haskell98, syb,
+                    data-accessor >= 0.2.1.3, containers, base >= 4 && < 5, 
+                    transformers >= 0.2, filepath, template-haskell, 
+                    data-accessor-template, data-accessor-transformers, 
+                    prettyclass, directory, tfp, th-lift, time
                     
   exposed-modules:  CLasH.HardwareTypes
                     CLasH.Translator