abigail: yes, im sure thats the only code. with the same code as you on my box (perl 5.6.0) i get different output. here is a transcript.

gotham:~# cat p.pl
#!/usr/bin/perl -w
use strict;
$ARGV[0]=$0;
$^I="";
undef $/;
while(<>) { print STDOUT "hello\n" }

gotham:~# perl p.pl
hello
hello
gotham:~#
[download]

weird, huh?