Looky here! No more application.master!
In Microsoft SharePoint Foundation, application pages can now inherit a customized site Master Page through the DynamicMasterPageFile attribute.
In addition, there are a few pages which have been designated as Safeguarded Application Pages. These are the application pages that have safeguards against a broken Master Page. If these pages encounter an error when loading the dynamic Master Page, a safe Master Page in the _layouts folder is loaded instead.