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msvc9compiler.py aims to generate a manifestation file but it will always fail as MSVC (cl.exe) needs a second /MANIFEST parameter to do so.
This makes the subsequent 'linking' processes fail with the following error:
general error c1010070: Failed to load and parse the manifest. The system cannot find the file specified.
http://msdn.microsoft.com/en-us/library/f2c0w594.aspx (default value is NO)

A manifest seems to be currently created fine - can you provide steps to reproduce the problem you see?

I have the same issue. To be honest it is because I'm using MSVC2010. I know it is not a supported platform but the patch to fix the problem is really just the following (and it is compatible with MSVC2008):
--- Lib/distutils/msvc9compiler.py.orig Mon Jun 21 17:27:46 2010
+++ Lib/distutils/msvc9compiler.py Mon Mar 12 13:23:56 2012
@@ -645,6 +645,7 @@
 build_temp,
 os.path.basename(output_filename) + ".manifest")
 ld_args.append('/MANIFESTFILE:' + temp_manifest)
+ ld_args.append('/MANIFEST')
 if extra_preargs:
 ld_args[:0] = extra_preargs
On a side-note I wrote a CMakeLists.txt for python for windows. I have to say it was pretty easy even if I'm not building everything (I left out tcl/tk and bsddb). I would hope python in the future could use a more flexible way if being built. For reference, I copy here the cmakelists.txt.

Distutils is now deprecated (see PEP 632) and all tagged issues are being closed. From now until removal, only release blocking issues will be considered for distutils.
If this issue does not relate to distutils, please remove the component and reopen it. If you believe it still requires a fix, most likely the issue should be re-reported at https://github.com/pypa/setuptools