I'm running Joomla 1.5.25 and have fully patched templates. What I've found is that my HIDDEN menu items - EVEN WHEN ASSIGNED to other templates utilize the DEFAULT template. This is highly problematic since I'm trying to migrate my site to a new design. I'm curious whether this is a 1.5 issue and if it was resolved in 1.7 or if there's something else going on there.
I'm just surprised that when a menu item is assigned to a template it doesn't just adopt those items. Very frustrating and wasn't easy to figure out.