Nicks in "never highlight" setting are filtered out from the chat

Binary package hint: xchat

It seems the version of xchat distribuited with ubuntu doesn't handle correctly the option "nicknames to not highlight" in preferences->chatting->alerts and treats them like if they were entirely ignored.
I would expect the text of the people in that list to be still displayed (but not highlighted if they say my name for example) in reality what they say is entirely filtered out till you remove them from the list.
I'd like to note an svn build from head of xchat (from the official repository of it https://xchat.svn.sourceforge.net/svnroot/xchat revision 1495 at the time of checkout) works perfectly. The logs don't show anything like this being fixed so either it was fixed without noticing or the bug afflicts only ubuntu(maybe debian) builds.

Distributor ID: Ubuntu
Description: Ubuntu 11.04
Release: 11.04
Codename: natty

xchat:
  Installed: 2.8.8-3ubuntu4
  Candidate: 2.8.8-3ubuntu4
  Version table:
 *** 2.8.8-3ubuntu4 0
        500 http://it.archive.ubuntu.com/ubuntu/ natty/universe amd64 Packages
        100 /var/lib/dpkg/status