The flashing state does not use the masking+glow but if the button is a group, the sub-buttons that paint on right side and behind will use the mask+glow
Actually I meant on Vista,that odd mouseover flash...it dosnt seem to respect any image edges...just a rectangle...even flashes over translucent parts.
Same with progress bars...the flash image dosnt respect content margins and just runs over the ends or edges.
But now that you mention the flashing state in 7...as a group its messed up somehow...like the underneath part is trying to use 2 image states...half flashing and half normal mouseover.
And it dosnt flash...just sits there. 
Which brings up a problem...this double and triple drawing grouped buttons looks kinda crappy sometimes...would be nice if we had a grouped button for that state...hint hint Neil. 
I'm also not seeing the pressed state being used at all.