Michael,

I have this old Q+A sheet from Intel where I found the following:

Quote
Q: Can a high priority interrupt be changed to a low priority while it is being serviced?

A: No, a latch is set when the LJMP into the interrupt service routine (ISR) is performed. Changing the IP reg after the ISR starts executing has no effect on the latch until the ISR is exited.
Unquote

Intel's answer is not fully consistent with the question in that they speak of a latch for the ISP setting, but apparently this latch is only effective when lowering the priority. This seems a little strange to me. Assuming that you're correct, and I have no reason to doubt that, can you explain how things really work?