Fixed #1970 by returning true instead of false when the mouse moves over a sub-element. The side effect is the event will not stop default behavior and will propagate which it didn't used to. I could find no compelling reason to stop those things from happening.

src/event.js

@@ -348,7 +348,8 @@ jQuery.fn.extend({
 			while ( parent && parent != this ) try { parent = parent.parentNode; } catch(error) { parent = this; };
 			
 			// If we actually just moused on to a sub-element, ignore it
-			if ( parent == this ) return false;
+			if ( parent == this ) 
+				return true;
 			
 			// Execute the right function
 			return (event.type == "mouseover" ? fnOver : fnOut).apply(this, [event]);