When trying to start a default log4j session with the following property:

log4j.configuration=file://${was.install.root}/properties/log4j.xml

the ${was.install.root} is not substituted.

Looking in OptionConverter.getSystemProperty(), I see that no substitution 
occurs.

How about modifying the method as follows:

  public static String getSystemProperty(String key, String def) {
    try {
      return substVars(System.getProperty(key, def), null);
    } catch (Throwable e) { // MS-Java throws 
com.ms.security.SecurityExceptionEx
      LogLog.debug("Was not allowed to read system property \"" + key + "\".");
      return def;
    }
  }

which will allow for great flexibility (especially when using log4j in a WAS 
environment).

Cheers,
Chris