I can tell you why you get the weird behaviour, but I can't help you with the problem you have overall (though I'd be interested to see the eventual solution).

What's happening here is that :attribute is not being inserted into the string till after the inner Lang::get() call. So here's what happens:

In the validation translation the string it's looking at is: 'The ' . Lang::get('input.:attribute') . ' is required.'

But at the point it retrieves the string from your validation rules it evaluates the inner Lang::get() and so you get:

Lang::get('input.:attribute') → 'input.:attribute' (there is no such key `input.:attribute` so return string unchanged)

Leaving the validation string to be translated as:

The input.:attribute is required.

So then this is translated with the validation rule, complete with ':attribute' insertion, which is why you see:

The input.email is required.

Hopefully that makes sense - basically :attribute is not actually evaluated when you think it will be, but later.

I found something at the bottom of the original language file:

'attributes' => array(
    'email' => 'E-mail address',
),

And it is working if I set it to the following (so I can link it to my input.php file):

'attributes' => array(
    'email' => Lang::get('input.email'),
),

Aha that makes sense. I was thinking "surely Laravel has a way to localise field names".