Okay, I lied, that was yesterday's WTF Android moment.
Today I banged my head against the desk because of this: while there is a way to create rounded images (that is, transform a bitmap with a circular mask to another bitmap) in code using the standard Android support library, there is no direct way to do that in the layout without resorting to 3rd-party libraries (or by copying their solution to your project). Well, technically there is support for rounded images in the standard Android libraries for wearables but not for generic Android stuff.