I was about to report that I was unable to breed horses, but on my fourth attempt, a foal was produced. I would still regard this as a bug, so I'll submit a report anyway
Single player, survival mode, new world created in 1.7.2.
On my first attempt to breed horses, both horses had armor, one had a saddle, and were in an area with other mobs (donkeys, horses, and chickens). I fed each a golden carrot, they entered 'love mode,' but then ignored each other.
On my second attempt, I moved them to a separate area without any mobs, and removed the equipment from both horses. The two horses were attracted, but after a moment, one of the horses exited 'love mode' – the horse which remained in 'love mode' continued to push against the other horse, but no foal was produced.
For my third attempt, I exited and restarted Minecraft, but the results were the same as my second attempt.
I decided to try one last time before hitting 'create' on this report. I fed each horse a golden carrot, they entered 'love mode,' but this time it worked! The only thing I did between #3 and #4 was slept – it was dusk for my third attempt, morning for my fourth.
I was hoping I had consistent repro for the issue, but that does not seem to be the case anymore.