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Problem: nose version is not inside the required version numbers for Pylons to install.
At the time of writing, Pylons 0.9.6rc1 requires a nose version between 0.9.2 and 0.9.9, which are no longer downloading through easy_install from the Cheeseshop. Furthermore, the Cheeseshop page has disappeared (this is linked to the update process of Cheeseshop).
To correct this problem you will need to download the package and install it by hand.
The Cheeseshop page for nose is: http://pypi.python.org/pypi/nose/0.9.3
The official nose 0.9.3 page is still available here: http://somethingaboutorange.com/mrl/projects/nose/0.9.3/
Obtain a copy of the tarball, extract it and run python setup.py install.
Nota Bene
This problem was found on AMD64 Linux systems. This document exists as a response to various requests for help regarding dependency issues.