git reset --hard in .git causes a checkout in that directory

Hi all,

When I was working on my code and made a mess that I wanted to undo, I 
accidentally did it in the .git directory, and had a whole clone of my 
last committed tree there.

It can be triggered easily:

mkdir test; cd test; git init; touch foo; git add foo; git commit -m 
'add foo'; cd .git; git reset --hard; [ -f foo ] && echo hello beauty

Other parts of git could be affected, I haven't checked where exactly 
the bug hides, so I was afraid to send in a patch

Cheers,
Maarten