The following command line, will elicit this problem:
( Dollar-sign, open-paren, single-quote, closed-paren, Return )
This will result in a ($PS2) prompt of
and this prompt loop is uninterruptible.
^C should interrupt the prompt loop.
Problem verified on:
BusyBox v1.18.4 (2011-06-04 01:59:32 ICT) multi-call binary.
BusyBox v1.18.5 (2012-01-17 00:17:48 ICT) multi-call binary.
Thus, a minor typo renders the current session unusable.