It turns out I had the sense of the GetLocalBounds bool wrong everywhere, so ...

chrome/browser/ui/views/tabs/side_tab_strip.cc

 // Copyright (c) 2011 The Chromium Authors. All rights reserved.
 // Use of this source code is governed by a BSD-style license that can be
 // found in the LICENSE file.
 
 #include "chrome/browser/ui/views/tabs/side_tab_strip.h"
 
 #include "chrome/browser/ui/view_ids.h"
 #include "chrome/browser/ui/views/tabs/side_tab.h"
 #include "chrome/browser/ui/views/tabs/tab_strip_controller.h"
 #include "grit/generated_resources.h"
@@ skipping 137 matching lines @@
 
   if (dragging_tab)
     dragging_tab->ProcessPaint(canvas);
 }
 
 BaseTab* SideTabStrip::CreateTab() {
   return new SideTab(this);
 }
 
 void SideTabStrip::GenerateIdealBounds() {
-  gfx::Rect layout_rect = GetLocalBounds();
+  gfx::Rect layout_rect = GetContentsBounds();
   layout_rect.Inset(kTabStripInset, kTabStripInset);
 
   int y = layout_rect.y();
   bool last_was_mini = true;
   bool has_non_closing_tab = false;
   separator_bounds_.SetRect(0, -kSeparatorHeight, width(), kSeparatorHeight);
   for (int i = 0; i < tab_count(); ++i) {
     BaseTab* tab = base_tab_at_tab_index(i);
     if (!tab->closing()) {
       if (last_was_mini != tab->data().mini) {
@@ skipping 57 matching lines @@
   bounds_animator().AnimateViewTo(separator_, separator_bounds_);
 }
 
 void SideTabStrip::DoLayout() {
   BaseTabStrip::DoLayout();
 
   newtab_button_->SetBoundsRect(newtab_button_bounds_);
 
   separator_->SetBoundsRect(separator_bounds_);
 }