Initially reported via Twitter: https://twitter.com/TheKevin8082/status/433252937683329025

Example of the users attempt: http://puu.sh/6S62x.jpg

Verified locally, the Aludel is not working as it should currently. Cursory glance seems to turn up that it broke with this PR: #612

Will examine more later.

Figured it out;

1. The recipe for Infused Logs is as @Dynious said (4 dust to 1 wood log)
2. If you have old Aludel's that you placed in the world, break them and replace them.

The example is not a bug, logs require 4 pieces of dust :P