Couldn't even make my own note private. This should be explicitly allowed, regardless of other thresholds, I think.

Your assumption about the meaning of $g_private_bugnote_threshold is not correct.

That parameters controls who can "view" a private bugnote, not who can make it provate. Making it public or private is an "update", so that's controlled by $g_update_bugnote_threshold

and yes, editing your own bugnote should work (including making it private)

In this case, there shouldn't be "Make Private" button on others' notes. The basic problem is that the check for displaying "Make Private" button, and the access check when the button is clicked, are different, right?

And I do wish there was a way to have threshold for making notes private/public lower than editing.

Targetting, for 1.2.0a3, a fix to only show the button when the user has update privileges to the bugnote.

Fix committed to 1.2.x development tree.

$t_can_edit in bugnote_view_inc.php line 163 should be $t_can_edit_note

Yes, I found this shortly after the release. It is already committed to the repository.

Hmm, in http://git.mantisbt.org/?p=mantisbt.git;a=log I see only one commit after the release, by Paul. In http://git.mantisbt.org/?p=mantisbt.git;a=tree the file is still wrong. In this tracker I don't see the "Make private" button on my notes (it says "Mantis 1.2.0a3 git snapshot 7f168ee" -- how do I find out what exactly this "snapshot 7f168ee" is, how does it relate to the log on the web?)

It was there before the rebase of master that happened a few days ago. I guess it just needs to be re-committed (though it won't have the same SHA1).

Since you seem to be keen on following the development, I suggest you join the mantisbt-dev mailing list at https://lists.sourceforge.net/lists/listinfo/mantisbt-dev and keep this kind of discussions there.