First, rebooting does NOT drain your battery in any perceptible way - don't push the myth, you have several battery applications to prove this for yourself on the N900.

When you can figure out how to restart X without the watchdog stuff rebooting the device - get back to us - or rather, get in touch with d-iivil, he's been contemplating this one for a long time.

To answer your question directly, no, it's not possible to apply themes fully without a reboot. And yup, rebooting does take time, patience is a virtue.