Nevermind, I found the problem. It seems that mini.login.phtml is incomplete.
<form action="<?=$formAction?>" method="post">
Apparently there isnt any variable $formAction in the model. Instead the line should be:
<form action="<?=$this->getPostActionUrl()?>" method="post">
So, if anyone on the Magento team reads this it might be a good idea to fix it for the next release.
Thanks Magento Team- AWESOME PRODUCT!!!!!!!