The eyelids of this avatar are like the horse's legs in the OP's demo. They should be "open" or transparent most of the time. They stay opaque until the head is selected. The slection outline should also be gone, I didn't have the head selected at the moment of taking this screen shot.

Second Life 1.23.0 (118378) Apr 24 2009 14:24:08 (Second Life Release Candidate)
Release Notes

Built with MSVC version 1400

You are at 263735.7, 254702.5, 78.6 in Ferguson located at sim5870.agni.lindenlab.com (216.82.51.172:13002)
Second Life Server 1.26.2.117266
Release Notes

CPU: AMD (Unknown model) (3000 MHz)
Memory: 2048 MB
OS Version: Microsoft Windows XP Service Pack 3 (Build 2600)
Graphics Card Vendor: NVIDIA Corporation
Graphics Card: GeForce 8600 GT/PCI/SSE2/3DNOW!
OpenGL Version: 3.0.0

-Create a box, add this script:

integer alpha;
default
{
    state_entry()
    {
        llSetTimerEvent(1);
    }
    timer()
    {
        if (alpha) llSetAlpha(1.0, ALL_SIDES); else llSetAlpha(0.0, ALL_SIDES);
        alpha = !alpha;
    }
}

-Drag a copy of the box.
-Link the two boxes. (Not an essential step, I think)

Observations:
-1.22 shows the boxes blink as expected.
-With 1.23.0 PN the boxes only blink with certain camera positions.
-When you manage to get both boxes blink, there's a chance you see the closest box behind the other. See screenshot "opaque_alpha_sorting_error".

=======

Second Life 1.23.0 (118316) Apr 23 2009 21:20:14 (Second Life Public Nightly)

Second Life 1.23.1 (119104) May 4 2009 17:53:10 (Second Life Release Candidate)

This would certainly need to be fixed before actual release.

ONLY the most severe, confirmed issues which demand immediate attention from Linden Lab. For example, inability for many Residents to login. IMPORTANT: Abusing this setting will cause revocation of Issue Tracker access. If in doubt, mark "Critical" instead.

I will say that while it may not be a showstopper according to that criteria, it is a deal-breaker for certain. If this bug makes it into the official mainstream viewer, it will break hundreds of thousands of products. At the very least, there are tens of thousands of Combat: Samurai Island users like Arishia and Coquette who own at least one product (and many have more than one) that will no longer function correctly. And that's only one line of products out of countless choices that use similar functionality.

There should be no question whatsoever about the importance of the issue, and it should not be allowed to remain under any circumstances.

=======

1.22.11 works smooth for me.

I would even argue that this viewer should no longer be considered a "release candidate", because that designation implies a level of quality not demonstrated by this version of the viewer.

As usual, it would be really great if some Linden dev could comment on the issue and provide some assurance that it will be resolved. Unfortunately, there is still no indication (at this point in time) that any Linden devs have even seen this issue, let alone that it will be fixed

rezzed_cam_focus_on_backdrop shows what a necklace is supposed to look like. To see the necklace properly I had to focus the cam on a different object (the backdrop). The prims in the necklace appeared properly only with the cam focused on the backdrop.

rezzed_cam_focus_on_necklace shows what happens if the cam is focused on the necklace. Many prims just vanish.

worn_normal_view shows yet a different set of vanished prims because it is worn. No amount of editing will help this problem. The missing prims are visible as ghosts in edit but do not rez.

worn_view_transparent is the same as worn_normal_view but with view transparent on so you can see the missing prims are not transparent at all. They are simply not rezzed yet are there if you edit. You can see the ghost outlines.

I suspect this catastrophic failure is somehow related to whatever was done to kill the "megaprim hack" that has the furry/tiny community furious. Just a hunch though.

If this is not fixed then this version is dead in the water and cannot be rolled out. If the assigned programmer needs a copy of anything displaying these symptoms just tell me and I'll send a copy along for troubleshooting.

Edit: Adding system info...

Second Life 1.23.1 (119104) May 4 2009 17:53:10 (Second Life Release Candidate)
Release Notes

Built with MSVC version 1400

You are at 267764.1, 279284.3, 4002.9 in Kali Isle located at sim3756.agni.lindenlab.com (216.82.22.237:13000)
Second Life Server 1.26.3.118673
Release Notes

CPU: Intel Core 2 Series Processor (2399 MHz)
Memory: 4095 MB
OS Version: Microsoft Windows Vista Service Pack 1 (Build 6001)

http://en.wikipedia.org/wiki/Software_release_life_cycle

The term release candidate (RC) refers to a version with potential to be a final product, ready to release unless fatal bugs emerge. In this stage of product stabilization (read QA cycle), all product features have been designed, coded and tested through one or more Beta cycles with no known showstopper-class bug."

... also...

"Beta" is a nickname for software which has passed the alpha testing stage of development and has been released to users for software testing before its official release. It is the prototype of the software that is released to the public. Beta testing allows the software to undergo usability testing with users who provide feedback, so that any malfunctions these users find in the software can be reported to the developers and fixed. Beta software can be unstable and could cause crashes or data loss. A "beta version" is the first version released outside the organization or community that develops the software, for the purpose of evaluation or real-world black/grey-box testing

It's been clear to me for quite some time that what Linden Research calls a Release Candidate Viewer would be called "beta" anywhere else.