That is disappointing.
I understand this is not your issue but a problem for virtuemart.
To my amazement, I have found no solutions on virtuemart forum, so I wrote a small script to modify the database.

Joomla 2.5.16
Virtuemart 2.0.26
JoomSEF 4
Virtuemart extension

This is an upgrade from Joomla 1.5
23,000 URLs were imported via SQL

There are two problems
Imported URLs do not work. e.g.
/index.php?option=com_virtuemart&category_id=622&page=shop.browse&Itemid=10622

Configuring JoomSEF to create new URLs places an ID (instead of virtuemart) into the SEF, e.g.
/31/category/product

We just resolved the isssue with the K2 module link on the homepage.
Changed the setting in advanced configuration under Itemid handling
Set Exclude source info (Itemid) to Yes.

However, the problem with multi category extension remains.

We trust that commercial products deserve support. That's why we purchase and support the developers.
The issue also is affecting a module we have on the home page links for featured K2 items - Latest Real Builders Projects.
The (Itemid=1) is appended to the URL on the homepage when it is not required.
e.g. www.realbuilders.com.au/index.php?option...p;id=42&Itemid=1

This page contains many examples:
www.realbuilders.com.au/projects/project...s/complete-new-homes

We have configured Joomla 1.5.23 with JoomSEF 3.9.7 with K2 extension 2.0.10 and SEFs are working OK except for any item that has a second category. We are using another component for K2 called K2 Multi Category usjoomlapros.com/forum/K2-Multi-Categories to allow more than one category per item.
The URL defaults to a non-sef link.
This means that most of our URLs are not SEF.
Please suggest a solution.

JoomSEF 3.9.1
Virtuemart extension 2.0.39

Is it possible to run URLs with and without shop name? e.g.
www.hardware2u.com.au/virtuemart/garden-lawn/garden-beds
www.hardware2u.com.au/garden-lawn/garden-beds

These need to point to the same page.