Thanks for the prompt reply.
On 2.1 with Configuration=Debug11, I get: The OutputPath property is not set for project 'CommandLine.csproj'.
Using more conventional Debug the build stops after the Build target with a Build FAILED message but no actual msbuild errors logged. Just some warnings in yellow:
warning MSB3270: There was a mismatch between the processor architecture of the project being built "MSIL" and the processor architecture of the reference "D:\workspace\nuget.git\src\CommandLine\bin\Debug\NuGet.exe", "x86".
It seems the VsExtension project is failing silently on DeployVsixExtensionFiles target. I guess I'll try to set up a VM that has only VS2012 on it and see how that goes.