2.0.7e generates wrong SEF urls for the product detail pages when VM SEF is enabled. When only Joomla-SEF is enabled, but VM SEF is disabled, all works well.
Going to the product details via menu works well even VM SEF is enabled.
But when clicking on a product in category view, not the product detail page is opened, but the list of manufacturers. Same problem when using a third-party module!
Hmm works for me completly normal. Except that this "/index.php/powertools/power-sander-detail.html" and this "/index.php/power-sander-detail.html" points to the product. Imho it should always show "/index.php/power-sander-detail.html", or should be configurable.
But I cant reproduce your error.
I just checked again: in 2.0.6 all works perfect, in 2.0.7e, instead of showing the product detail page when clicking on a product, the list of manufacturers is shown.
But I encountered another problem in 2.0.7e, which already had been there in earlier versions but had been fixed in 2.0.6:
it looks like there are some problems with javascript, because I´m not able anymore, to delete a product from the cart by clicking on the trash icon, I have to update the product count with 0 to do so...
Maybe, this has the same reason...