Another note: I realize that I shouldn't use `expand-top-sequence' to restart the expander within a local lexical environment. At first glance, I guess I should be using `expand' instead.
Another possibility: if the (capture-lexical-environment) was found within a body or sequence where local definitions are permitted, restart using the appropriate expansion function that allows local definitions. However, I haven't yet determined whether this is feasible given the way psyntax handles bodies. For that matter, I haven't decided whether this would be desirable. Anyway, now I must sleep. Best, Mark