This is not a regression, so it shouldn't be flagged for potential inclusion in the 1.2.1 bugfix release (if we ever in fact make such a release). Also, since it's an "Improvement" it probably doesn't need an "Affects Version".
Also, generally we only mark things as fixed in a single version, either the next upcoming release, or the release branch we intend to backport it to. We generally fix things in trunk, including adding a message to CHANGES.txt, then sometimes backport the patch to a release branch. Things that are backported should be moved to the section of trunk's CHANGES.txt for the branch they're backported to. We don't want a change listed twice in CHANGES.txt, since trunk generally includes all changes listed. So the only time things are marked as fixed in multiple versions are things that will be backported to multiple branches. Does that make sense?