Panel->Miscellaneous->Panel treatment One option is: Keep panels below other windows. Notably, this keeps it below the nautilus desktop. :)
That setting is sort of random. It places the panel in the "desktop layer", meaning that nautilus and the panel is in the same layer. Then the window manager randomly selects which window is at top. The feature itself can be useful (polling around the office two people use it), but maybe we should add a gruesome hack to make the panel stay over nautilus. Otherwise it is hard to recover from this state.
A gruesome hack isn't needed; there is a window layer above the desktop and below the normal windows. We can set the panel in that layer. So this is a one-char fix, like s/2/3/ There's some risk it will confuse the hell out of Sawfish. I'll test out the change and see if it looks safe.
Ouch, it turns out the panel is already setting the between-desktop-and-windows hint,and nautilus sets the desktop hint. So this is a Sawfish issue.
*** Bug 52738 has been marked as a duplicate of this bug. ***
gruesome sawfish workaround added to gnome-core 1.4.0.4-37 need to remove the gnome-core hack when sawfish is fixed
Should be fixed in 1.4.0.4-43