Gents, I actually discovered there is a bug in 1.2 for this:
In Document.cshtml, the line:
var title = (Request.Path.TrimEnd('/') != Request.ApplicationPath.TrimEnd('/') && HasText(Model.Title)
? Model.Title + WorkContext.CurrentSite.PageTitleSeparator
: "") + WorkContext.CurrentSite.SiteName;
Is missing the portion in red. This causes the site to fail formatting the title correctly if it is run as a root website (not under an app directory..)
So, the solution I was looking for, was actually being caused by a bug!