Sorry, this isn't documented well. I'll make another note to add this
to the new docs.
You define your post_excerpt function like you have, then you need to
assign it to be the default excerpt function:
def my_post_excerpt(post, num_words=50):
return "Derp derp"
blog.post_excerpt.method = my_post_excerpt
Then, if for instance you wanted to show excerpts on the chronological
listings, but still show the full post on the permalink pages, you
also need to modify your chronological.mako file to include
post_excerpt.mako rather than post.mako:
<%include file="post_excerpt.mako" args="post=post" />