[SQL] Bug with rules in 7.0.3?

[Tod McQuillin]

Hi there... I've spotted something weird in 7.0.3 with rules.  By now I've
realised I probably need to use a trigger to do what I have in mind, but
even so, there no way I can explain the behaviour I am getting with a
rule.

Given this SQL script:

CREATE TABLE menu (
        menu_id         SERIAL PRIMARY KEY,
        name            TEXT,
        price           integer
);

INSERT INTO menu(name, price) VALUES ('Beer', 5);
INSERT INTO menu(name, price) VALUES ('Vodka', 10);
INSERT INTO menu(name, price) VALUES ('Scotch', 8);

CREATE TABLE orders (
        order_id        SERIAL PRIMARY KEY,
        menu_id         INTEGER REFERENCES menu,
        price           INTEGER NOT NULL DEFAULT -1
);

CREATE RULE fix_order_price AS
ON INSERT TO orders
DO
        UPDATE orders
        SET price = M.price
        FROM menu M
        WHERE M.menu_id = new.menu_id
        AND new.price = -1;

INSERT INTO orders (menu_id) VALUES (2);

SELECT * FROM orders;

Here's what happens:

% createdb buggy
CREATE DATABASE
% psql buggy < ~/pg.bug
NOTICE:  CREATE TABLE will create implicit sequence 'menu_menu_id_seq' for SERIAL 
column 'menu.menu_id'
NOTICE:  CREATE TABLE/PRIMARY KEY will create implicit index 'menu_pkey' for table 
'menu'
CREATE
INSERT 259680 1
INSERT 259681 1
INSERT 259682 1
NOTICE:  CREATE TABLE will create implicit sequence 'orders_order_id_seq' for SERIAL 
column 'orders.order_id'
NOTICE:  CREATE TABLE/PRIMARY KEY will create implicit index 'orders_pkey' for table 
'orders'
NOTICE:  CREATE TABLE will create implicit trigger(s) for FOREIGN KEY check(s)
CREATE
CREATE 259722 1
INSERT 0 3
 order_id | menu_id | price
----------+---------+-------
        1 |       2 |    -1
        2 |       2 |    -1
        3 |       2 |    -1
(3 rows)

How the heck can one insert and update generate three rows?
-- 
Tod McQuillin