With multiple test items operator defaults to "and". In case of 1.3.7
the tests check whether --address flag is either set to 127.0.0.1 or not
set at all. Those conditions cannot be met at the same time.
Path to kubelet configuration was accidentally prefixed with a dollar
symbol (probably as a result of copying some other test that used
variable name).
After removing the dollar sign from paths both checks pass on conforming
deployment.