diff -r aa404f3f661b -r d78fe60f6bda mercurial/ui.py
--- a/mercurial/ui.py	Sat Oct 17 15:40:34 2009 +0200
+++ b/mercurial/ui.py	Mon Oct 19 22:19:28 2009 +0300
@@ -198,10 +198,12 @@
 
     def _path(self, loc):
         p = self.config('paths', loc)
-        if p and '%%' in p:
-            self.warn("(deprecated '%%' in path %s=%s from %s)\n" %
-                    (loc, p, self.configsource('paths', loc)))
-            p = p.replace('%%', '%')
+        if p:
+            if '%%' in p:
+                self.warn("(deprecated '%%' in path %s=%s from %s)\n" %
+                          (loc, p, self.configsource('paths', loc)))
+                p = p.replace('%%', '%')
+            p = util.expandpath(p)
         return p
 
     def expandpath(self, loc, default=None):