Ended up still having to reflash..urgh.

When you are tired and a file extracts itself to /home/user/home/user Do Not in your fatigue type rm -rf /home into xterm and hit enter without thinking about it.... lol

On the upside, this was a fabulous learning experience into how Maemo actually works and what is stored where. I actually saw what happens to the desktop when it has no reference config files or anything, and I saw a mouse pointer on my n810 desktop at boot.