I think I did the dreaded, I walked away from the connected vpnc connection without disconnecting it. And when I tried to connect it again to my home wifi network it would connect to the wireless router but its not connected to the internet. I can ping the router and it seems to be alive. There is no packet loss there. But when I try to ping any website on Internet then its dead.

I also tried to use my phone as a modem to connect to the internet and same thing happened. It is connected to phone but no data transfer occurs. No websites can open.

I also did route del default as indicated in another post but that didn't help either.

There was a similar bug submitted to Maemo bug jar but they closed it since VPNC is not a supported Maemo application.
https://bugs.maemo.org/show_bug.cgi?id=3790

Any insights into this will help a lot. I do not want to reflash the device just due to this problem.

solution is found from the last post of the bug report you linked..

Yes. I was able to resolve the issue by referring to the last post from the bug that I had linked.

I would like to add the solution here too

As a root, you need to type following line in order to restore previous nameserver.

echo nameserver 127.0.0.1 > /etc/resolv.conf

After writing this, it fired back up like before.

Thanks mikkov for pointing this out to me.