I have verified this bug by following the provided test case and after modifying my /etc/apt/sources.list file to use ftp://ftp.chg.ru/pub/Linux/ubuntu/archive I was unable to successfully upgrade to Hardy. After using 'do-release-upgrade --proposed --mode desktop' I was able to upgrade to Hardy.
I have verified this bug by following the provided test case and after modifying my /etc/apt/ sources. list file to use ftp://ftp. chg.ru/ pub/Linux/ ubuntu/ archive I was unable to successfully upgrade to Hardy. After using 'do-release-upgrade --proposed --mode desktop' I was able to upgrade to Hardy.