Okay, nice hack but you might as well cut out whole baking process and generate your normal from diffuse. Because resulting map doesn't have any big or medium surface definition left, just surface dents and noise.
@ sandro - Baking a diffuse to normal isn't going to give you the right results at all. The information is usually not what you want most of the time. You usually want a height map but then you lose out on edge quality so you compensate through extra geo on edges. Yeah, just changing the smoothing groups can help but it…