What happens if the localhost does not interpret 127.0.0.1 as the loopback address?

Question

For the sake of the example, assume gateway to be 10.0.0.1 and host A (my machine) to be 10.0.0.2.

If gateway (10.0.0.1) is running a service bound to a port on localhost only, the service should be inaccessible to anyone on the network. However, if I configure machine A (10.0.0.2) to route all traffic to 127.0.0.1 through 10.0.0.1, would 10.0.0.1 then route those packets to itself? Is my assumption correct that packets sent to 127.0.0.1 regardless of their source will be sent to that address and therefore, packets which leave localhost but are addressed to 127.0.0.1 will become addressed to the next "hop"'s loopback? Does it largely depend on the network and gateway or does it work/not work in most cases?

A transcript of what I mean:

10.0.0.1 - "Hey! Send this to 127.0.0.1 for me, 10.0.0.1?"
10.0.0.2 - "Sure!"
10.0.0.2 - *oh, that's me*
10.0.0.2 - "Here's the reply 127.0.0.1 (I) gave, 10.0.0.2"
10.0.0.1 - "Thanks!"

I'm not sure if that makes sense, or is possible at all, but if so that would probably be a pretty big security hole for machines running local-only services and forwarding other machines' traffic.

Answer 1

You cannot route any traffic destined to any address in the 127.0.0.0/8 block on an external network. Any address in the 127.0.0.0/8 block can never appear anywhere on any network, nor can any address in that block be used as a source or destination address for packets outside the host.

The goes back at least as far as RFC 990, ASSIGNED NUMBERS:

The class A network number 127 is assigned the "loopback" function, that is, a datagram sent by a higher level protocol to a network 127 address should loop back inside the host. No datagram "sent" to a network 127 address should ever appear on any network anywhere.

-and-

RFC 1122, Requirements for Internet Hosts -- Communication Layers:

(g) { 127, }

Internal host loopback address. Addresses of this form MUST NOT appear outside a host.

-and-

RFC 1700, Assigned Numbers:

(g) {127, }

Internal host loopback address. Should never appear outside a host.

-and-

RFC 3330, Special-Use IPv4 Addresses:

127.0.0.0/8 - This block is assigned for use as the Internet host loopback address. A datagram sent by a higher level protocol to an address anywhere within this block should loop back inside the host. This is ordinarily implemented using only 127.0.0.1/32 for loopback, but no addresses within this block should ever appear on any network anywhere [RFC1700, page 5].

-and-

RFC 5735, Special Use IPv4 Addresses:

127.0.0.0/8 - This block is assigned for use as the Internet host loopback address. A datagram sent by a higher-level protocol to an address anywhere within this block loops back inside the host. This is ordinarily implemented using only 127.0.0.1/32 for loopback. As described in [RFC1122], Section 3.2.1.3, addresses within the entire 127.0.0.0/8 block do not legitimately appear on any network anywhere.

That means that Host A cannot route packets destined to 127.0.0.1 to a gateway on the network because that address cannot appear on the network as a destination address.