What is the issue this change is attempting to fix?

env variable has changes to PATH that is ignored because of the way mock.patch worked. This made code depending on numpy fail. See the linked issue above.

Has this code ever worked?

This code worked before 360aadc, but when the fallback was introduced in 6e92cda, this stopped working.

Reading through the issue reported in Numpy, the fix for #15 was incomplete (did not have the intended effect), but no one noticed because SETUPTOOLS_USE_DISTUTILS=stdlib became the default again... until earlier this week when the local copy of distutils was reintroduced by default.

Yep. Another reason is that for this issue to appear you need to have an environment without Visual Studio tools activated which is something done in most CI scripts and the lack of a PATH update doesn't matter.

Using the example, it seems that patch.dict works as expected:

import unittest.mock
import os
import subprocess
with unittest.mock.patch.dict(os.environ, {"FOO": "bar"}):
    print(os.environ["FOO"])
    subprocess.check_call("echo FOO=$FOO", shell=True)

outputs

bar
FOO=bar

Thanks