Disabling ‘full screen mode’ in Lion (to use transparent full screen iTerm2)

Windows Console settings are kept in Registry (Start → Run → regedit), under the HKEY_CURRENT_USER\Console key¹.

• The default settings are under HKCU\Console itself. Make sure the FullScreen value is set to 0. If not, change it.
• Per-program settings are stored in sub-keys named according to the program's path. Look for an entry belonging to your compiler, fix it if necessary.
• You can just delete the entire HKEY_CURRENT_USER\console key (although you will lose the customizations you might have wanted to keep).

A trick you could try:

Start a long compile, and just after the full-screen switch press Pause on your keyboard to pause it, then Alt+Esc to minimize the window. Right-click on its button in the taskbar, choose Properties, then Options, and select Display Options → Window.

¹ In regedit, keys are the folders in the left-side tree, and values are items in the right-side list.

The latest iTerm2 beta builds have this fixed. I can confirm that it is fixed in iTerm2-1_0_0_20121224.zip, but you'll probably want to run the latest build available. See this for the latest builds. They don't show up in the updates for me, even with Beta builds check enabled.