Projectgeometry comand does not honor Pellipse system variable

I have a set of polylines that I needed to project to a curved surface. I managed to do this successfully with the PROJECTGEOMETRY command.

The projected lines output from the PROJECTGEOMETRY command is splines and ellipses. I needed them to be polylines. Converting splines was easy but converting ellipses was a failure.

I tried to use ellipse converting lisp files from the forum. They converted the ellipses on the projected surface to 2d polylines (not 3d polylines) which changed it shape on the curved wall.

I then tried using the PROJECTGEOMETRY command after changing the PELLIPSE variable to 1 which according to the help file will create a polyline representaion of an ellipse. But it seems PROJECTGEOMETRY does not honor the PELLIPSE system variable setting. 

Is there any way that the ellipse projected on the curved wall can be converted to a 3d pline? Sample file attached.

Image may be NSFW.
Clik here to view.Image may be NSFW.
Clik here to view.Image may be NSFW.
Clik here to view.Image may be NSFW.
Clik here to view.Image may be NSFW.
Clik here to view.

Image may be NSFW.
Clik here to view.