diff --git a/lib/layouts/sweave.module b/lib/layouts/sweave.module
index 5318500b1d..11b9e35b25 100644
--- a/lib/layouts/sweave.module
+++ b/lib/layouts/sweave.module
@@ -1,6 +1,6 @@
 #\DeclareLyXModule[sweave->latex,fancyvrb.sty]{Sweave}
 #DescriptionBegin
-#Allows to use the statistical language S/R as a literate programming tool via Sweave package.
+#Allows to use the statistical language S/R as a literate programming tool via the Sweave() function.
 #See sweave.lyx in examples.
 #DescriptionEnd
 #Category: literate
@@ -16,7 +16,7 @@ End
 
 AddToPreamble
 	<<echo=F>>=
-	  if(exists("ls.enc")) options(encoding=ls.enc)
+	  if(exists(".orig.enc")) options(encoding = .orig.enc)
 	@
 EndPreamble
 
@@ -27,6 +27,8 @@ Style Chunk
 	Margin                static
 	Align                 Left
 	AlignPossible         Block, Left, Right, Center
+	TopSep                0.7
+	BottomSep             0.7
 	NewLine               0
 	FreeSpacing           1
 	PassThru              1
diff --git a/lib/scripts/lyxsweave.R b/lib/scripts/lyxsweave.R
index 25cfcb3ac3..c5d1135d79 100644
--- a/lib/scripts/lyxsweave.R
+++ b/lib/scripts/lyxsweave.R
@@ -13,7 +13,7 @@
 # argument 3 is the iconv name for the encoding of the file
 # argument 4 is the original document directory
 
-ls.args <- commandArgs(trailingOnly=TRUE)
+.cmdargs <- commandArgs(trailingOnly=TRUE)
 
 # check whether Sweave.sty is seen by LaTeX. if it is not, we will
 # copy it alongside the .tex file (in general in the temporary
@@ -21,35 +21,36 @@ ls.args <- commandArgs(trailingOnly=TRUE)
 # but this is a problem of installation of R on the user's machine.
 # The advantage compared to the use of stylepath, is that the exported
 # .tex file will be portable to another machine. (JMarc)
-ls.sweavesty <- system("kpsewhich Sweave.sty", intern=TRUE, ignore.stderr=TRUE)
-if (!length(ls.sweavesty)) {
-   stypath <- file.path(R.home("share"), "texmf", "tex", "latex", "Sweave.sty")
-   file.copy(stypath, dirname(ls.args[2]), overwrite=TRUE)
+if (!length(system("kpsewhich Sweave.sty", intern=TRUE, ignore.stderr=TRUE))) {
+  file.copy(file.path(R.home("share"), "texmf", "tex", "latex", "Sweave.sty"),
+    dirname(.cmdargs[2]), overwrite=TRUE)
 }
 
-# set default encoding for input and output files; ls.enc is used in
+# set default encoding for input and output files; .orig.enc is used in
 # the sweave module preamble to reset the encoding to what it was.
-ls.enc <- getOption("encoding")
-options(encoding=ls.args[3])
+.orig.enc <- getOption("encoding")
+options(encoding=.cmdargs[3])
 
 # Change current directory to the document directory, so that R can find 
 # data files.
-setwd(ls.args[4])
+setwd(.cmdargs[4])
 
 # this is passed as a prefix.string to tell where temporary files should go
 # the output file without extension and without '.'
-tmpout <- gsub(".", "-", sub("\\.tex$", "", basename(ls.args[2])), fixed = TRUE)
-# replace 
-ls.pr <- paste(dirname(ls.args[2]), tmpout, sep="/")
+tmpout <- gsub(".", "-", sub("\\.tex$", "", basename(.cmdargs[2])), fixed = TRUE)
+# replace
+.prefix.str <- paste(dirname(.cmdargs[2]), tmpout, sep="/")
+rm(tmpout)
 
 # finally run sweave
-Sweave(file=ls.args[1], output=ls.args[2], syntax="SweaveSyntaxNoweb", prefix.string=ls.pr)
+Sweave(file=.cmdargs[1], output=.cmdargs[2], syntax="SweaveSyntaxNoweb", prefix.string=.prefix.str)
 
 # remove absolute path from \includegraphics
-ls.doc = readLines(ls.args[2])
-ls.cmd = paste('\\includegraphics{', dirname(ls.args[2]), "/", sep = "")
+options(encoding=.cmdargs[3])  # encoding has been changed in the preamble chunk
+ls.doc = readLines(.cmdargs[2])
+ls.cmd = paste('\\includegraphics{', dirname(.cmdargs[2]), "/", sep = "")
 ls.idx = grep(ls.cmd, ls.doc, fixed = TRUE)
 if (length(ls.idx)) {
    ls.doc[ls.idx] = sub(ls.cmd, "\\includegraphics{", ls.doc[ls.idx], fixed = TRUE)
-   writeLines(ls.doc, ls.args[2])
+   writeLines(ls.doc, .cmdargs[2])
 }