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At first I was not sure it worked till after I used RAW2DNG on the RAW then I dragged the DNG's onto the CR2HDR.exe and it modified the interlaced ones correctly.
Now one can process dual iso video just with new raw2dng. It combines dual exposures automatically right from raw file and gives the ready dng's at output.
Check the first post in this thread: http://www.magiclantern.fm/forum/index.php?topic=7139.0
There is a link to the latest raw2dng at the postprocessing section.