clojure.core/byte was modified a couple weeks ago as follows:

(defn byte
"Coerce to byte"
{:tag Byte
:inline (fn [x] `(. clojure.lang.RT (byteCast ~x)))}

• [^Number x] (. x (byteValue)))
  + [^Number x] (clojure.lang.RT/byteCast x))

byteValue and byteCast behave differently with values outside the
range of byte values:
user=> (. 255 (byteValue))
-1
user=> (clojure.lang.RT/byteCast 255)
java.lang.IllegalArgumentException: Value out of range for byte: 255
(NO_SOURCE_FILE:0)

The new version breaks clojure.contrib.shell/sh's :out :bytes mode (mapping byte over values returned by InputStream.read in shell.clj, line 125).
Perhaps have sh use #(.byteValue %) instead of byte? (untested)