strange c# lambda expression behavior

Here's a nice one:

public static void Foreach<T>(
this IEnumerable<T> collection,
Action<T> action)
{
 foreach (var item in collection)
     action(item);
}

public static IEnumerable<T> Foreach<T>(
this IEnumerable collection,
Func<Object, T> action)
{
 foreach (var item in collection)
     yield return action(item);
}

var files = Directory.GetFiles(dir, "*.xml");
// #1
files.Foreach(xmlFile => DoSomething(xmlFile));

// #2
files.Foreach(xmlFile => { DoSomething(xmlFile); });

Given that the files array is not empty.

#1 doesn't call DoSomething(), #2 does. Why?