Scratch that, cleared cached in FF 3.0 and it is working, the problem has been resolved since RC3
(still can't quite shake the feeling that it's something I'm doing wrong, though...)
For what it's worth, I'm getting this problem as well, but only from Firefox 3.0... FF 2.0 and IE are working OK.
I have had to remove "DirectorySlash Off" from .htaccess to allow browsing to mydomain.com/mysite as well. (was failing with 403 forbidden before that)
I'm using PHP 5.2.5 and Apache 2.2.
A coworker has an account on the same webserver, and hers works fine in all browsers, with no hacks made to .htaccess either, so I'm really puzzled as to what I'm doing wrong. The only difference is our installation methods (she uploaded via FTP and extracted using her supplied file manager while I was lazy and wget'd/untar'd from a shell) and that hers is running in her document root, while mine is running in a subdirectory of my document root.
I know I've got to be doing something stupid, and I will keep looking, but if someone could throw me a clue I'd be very grateful ;)