Proposed resolution (February, 2012):

Change 12.2.4.3 [over.ics.rank] bullet 4.3 as follows:

• If class B is derived directly or indirectly from class A and class C is derived directly or indirectly from B,

• conversion of C* to B* is better...

• binding of an expression of type C to a reference of to type B& is better than binding an expression of type C to a reference of to type A&,

• ...

• binding of an expression of type B to a reference of to type A& is better than binding an expression of type C to a reference of to type A&,

• ...