fuse_dfs sets usetrash option when the "notrash" flag is given. This is the exact opposite of the desired behavior. The "usetrash" flag sets usetrash as well, but this is correct. Here are the relevant lines from fuse_options.c, in latest HDFS HEAD:
123 case KEY_USETRASH:
124 options.usetrash = 1;
126 case KEY_NOTRASH:
127 options.usetrash = 1;
This is a pretty trivial bug to fix. I'm not familiar with the process here, but I can attach a patch if needed.