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Turns out there are known issues with MySQL on InnoDB and the South migration system.
http://south.aeracode.org/ticket/666
This is something that may be fixed within the South project, but we are definitely not touching it.
Please switch to using either PostgresQL or configure MySQL to use InnoDB storage engine.
We are now discussing a possibility to explicitly raising an exception when people use InnoDB and tell them to switch - at least until the bug is fixed.