Notes from the April, 2005 meeting:

The phrase “looked up in the scope of [a] class” occurs frequently throughout the Standard and always refers to the member name lookup described in 6.5.2 [class.member.lookup]. This is the first interpretation mentioned above (“only members of the class and its base classes”), resolving s1 to ns::s1. A cross-reference to 6.5.2 [class.member.lookup] will be added to 6.5.3 [basic.lookup.unqual] paragraph 10 to make this clearer.

In discussing this question, the CWG noticed another problem: the text quoted above applies to all template-arguments appearing in the function declarator. The intention of this rule, however, is that only template-arguments in the declarator-id should ignore the member function's class scope; template-arguments used elsewhere in the function declarator should be treated like other names. For example:

     template<typename T> struct S;
     struct A {
       typedef int T;
       void foo(S<T>);
     };
     template <typename T> struct B {
       friend void A::foo(S<T>);  // i.e., S<A::T>
     };