Circle-slash on startup, MacPro 2 x 2.66 GHz Dual-Core Intel Xeon

Question

After attempting to get a friend's 3rd gen iPod to mount (only to retrieve data from it), I'm now getting a circle w/ a slash upon startup. it will, however, boot in "safe mode". My third year of AppleCare expired a little over a month ago, of course. Thought I'd try here before paying the $49 per incident support call, or reinstalling 10.6 fresh off disk, or restoring from Time Machine backup. And I figure that $50 would be spent for someone to tell me to do a fresh install or restore. I'd rather spend $100± on Disk Warrior, as this tower is aging, and I'd like to keep it for a while longer -- likely a smarter investment.
MP MacPro1,1 @ 2.66 GHz (x 4), 12288 MB RAM, running OS Build: Mac OS X 10.6 (10A432)
Apple Cinema 30"
12GB RAM
Internal boot drive is 250GB, with 100GB available
Any and all applicable firmware updates have been run, long ago.
1) i have disconnected all external hard drives and peripherals, save the Kensington turbo mouse because i can't find my original mouse
2) i have booted off the snow leopard disk to run disk utility.
a) running verify and repair (separately) both result "the volume appears to be ok."
b) repair permissions results:
Permissions differ on "usr/share/derby", should be drwxr-xr-x, they are lrwxr-xr-x
Repaired "usr/share/derby"
Warning: SUID file "System/Library/CoreServices/RemoteManagement/ARDAgent.app/Contents/MacOS/ARDAg ent" has been modified and will not be repaired
3) booting in single user mode stalls out immediately after "Apple Intel CPU Power Management initialization complete", then says "still waiting for root device" several times (i've waited as long as 10 minutes with the same repeating "still waiting for root device" before powering down.)
4) i've also reset the PRAM
5) i've also reset the SMC
I've read http://support.apple.com/kb/TS1892 BUT is there any way to repair the above permissions issue via Terminal? I suspect that's what the issue is because it's the only issue Disk Utility could identify. I'm scared of doing something stoopid in Terminal because I haven't clue #1 in that situation.
Any advice you could give would be very much appreciated.

Answer 1

I placed an AppleCare call, and the fine gentleman took pity on me, realizing I was but a month outside of my support and after reviewing the below, so I wasn't charged.
1) tried resetting the home folder permissions and ACLs via SL "reset password" utility, but that didn't work.
2) recommended "archive and install" via SL disk. which I did.
back up and running. will undoubtedly have some things to put back together, but cest la vie.