diff -r -u meld.orig/meld/dirdiff.py meld/meld/dirdiff.py
--- meld.orig/meld/dirdiff.py	2013-02-28 09:38:04.065534644 -0600
+++ meld/meld/dirdiff.py	2013-02-28 09:47:43.497497083 -0600
@@ -179,7 +179,10 @@
         contents = ["".join(c) for c in contents]
         for r in regexes:
             contents = [re.sub(r, "", c) for c in contents]
+        if prefs.ignore_blank_lines:
+            contents = [re.sub('((\n)|(\r\n))*','\n', c) for c in contents]
         result = SameFiltered if all_same(contents) else Different
 
     _cache[(files, regexes)] = CacheResult(stats, result)
+
     return result
