what I would like python.el to do (and maybe it does)

[rustom]

> But since i like to do it The Right Way, I would
> like to let the python-mode worry about this...
>
> Sorry if this is just a bunch of obvious thoughts to most of you.
>
> Regards,
> Giovanni

I dont see whats the problem.
Heres my attempt to show you my emacs windows using python-mode
(python.el never worked for me)
## Window 1 file foo.py (python mode)
x = 1

y = 2

## Window 2 python interpreter
>>>

####
Goto the python file (foo.py)
Select the x=1 line
C-c | (which is py-execute-region)
Goto python interpreter window
>>> x
1
>>> y
...
NameError: y not defined

What more/less/else do you want?

Are you using python-mode.el or python.el?