Cannot distill homeomorphic embedding

[hirrolot]

Distillation on the following code does not terminate in a reasonable amount of time (~3 hours):

main = decideHe s t;

decideHe s t = case s of
    Call(h, args) -> (case t of
        Call(h', args') -> (case dive s args' of
            T -> T
          | F -> (case equalSymbols h h' of
                T -> couple args args'
              | F -> F)));

dive s args' = case args' of
    Nil -> F
  | Cons(t, ts) -> (case decideHe s t of
        T -> T
      | F -> dive s ts);

couple args args' = case args of
    Nil -> (case args' of
        Nil -> T
      | Cons(t, ts) -> F)
  | Cons(s, ss) -> (case args' of
        Nil -> F
      | Cons(t, ts) -> case decideHe s t of
            T -> couple ss ts
          | F -> F);

equalSymbols h h' = case h of
    A -> (case h' of
        A -> T
      | B -> F
      | C -> F)
  | B -> (case h' of
        A -> F
      | B -> T
      | C -> F)
  | C -> (case h' of
        A -> F
      | B -> F
      | C -> T)

The higher-order deforester terminates almost immediately on this program (although the result is not very interesting -- the intermediate boolean values were still there).