A ctrl-C sends a message, CTRL-C-EVENT, to the process group (where > 1 processes are using the same console). This should kill the process unless a console handler is set (SetConsoleCtrlHandler C API). It seems likely that ActiveState traps this, since you get a "Terminated on signal SIGINT" under normal circumstances (or it might be using the C RTL signals?).
You can send a CTRL-C using API GenerateConsoleCtrlEvent, but, like everyone else, I don't know why these hangs should occur (buffering was my first thought too).
Just a thought, how are you launching the programs, through cmd.exe, Windows Explorer, or some other way?