client-local.cfg backticks expression help

Using Jeremy's amazing example here
http://lists.xymon.com/pipermail/xymon/2013-January/036615.html I'm trying
to do something a little simpler...
 
Basically, if the line contains "debug:" replace it and the rest of the line
with "DEBUG LINE DETECTED AND REPLACED".  Otherwise just output the log
normally.
 
Here is what I have tried and the part within the backticks works fine (if I
exclude the exec part that hangs my bash session) from a command line to
produce the name of the file:

log:`exec 2>/dev/null; F=/path/to/file/log.log; T=/tmp/substitutedlog.log;
C=$(sed 's/debug:.*/DEBUG LINE DETECTED AND REPLACED/' $F > $T); echo
$T`:1024
log:`exec 2>/dev/null; F=/path/to/file/log.log; T=/tmp/substitutedlog.log;
sed 's/debug:.*/DEBUG LINE DETECTED AND REPLACED/' $F > $T; echo $T`:1024
log:`exec 2>/dev/null; F=/path/to/file/log.log; T=/tmp/substitutedlog.log;
sed "s/debug:.*/DEBUG LINE DETECTED AND REPLACED/" $F > $T; echo $T`:1024
log:`F=/path/to/file/log.log; T=/tmp/substitutedlog.log; sed
"s/debug:.*/DEBUG LINE DETECTED AND REPLACED/" $F > $T; echo $T`:1024

But /usr/share/xymon-client/logs/xymonclient.log gets this:

sh: -c: line 0: unexpected EOF while looking for matching `''
sh: -c: line 1: syntax error: unexpected end of file

Or this:

sh: -c: line 0: unexpected EOF while looking for matching `"'
sh: -c: line 1: syntax error: unexpected end of file

...depending on whether I use single or double quotes in the sed expression.

Kind regards, 

SebA