Well, I got past it. Don't ask me to try to remember the full chain of logic (or something

) that got me here...should really stop troubleshooting late at night, probably. :]
Quagga, to answer a few of your questions: yes, I used update-manager, and
NO, I absotively did not touch ext4. I'm really impressed by some of the performance reviews I've seen so far, and I may change the media partition on our hard drive (still haven't gotten around to installing the OS there yet :/ - that's a project and thread for another day

) to it, but...not ready to go there yet. Also, as I said before, the process update-manager starts seems to kill any other repository(ies) than Canonical's, so...still haven't re-enabled neuros's yet. I suppose I will eventually.
Turns out that if I just do a 'modprobe usb-storage' at the initramfs prompt, wait a bit for its messages to go by, and then type exit - boot proceeds (relatively) normally. First boot it told me I had a graphics problem, but when I got to the "low-res" desktop, I deactivated fglrx from the "restricted drivers manager" under system/administration, and then rebooted.
Et voila!! I never got around to going through the steps to make the display "fill to edge" on our TV - but now I don't have to!! Whatever default Ubuntu wants to do for that card seems to be performing admirably. I guess that's just the same xorg driver, a few revs down, that you pulled with git, Quagga? In any case it seems to be a little
more zippy than the old driver, manufacturer cooperation or not. 720p x.264 mkvs play nicely as always, but the real kicker is that a 1280 one, that previously choked up
horrendously without -lavdopts skiploopfilter=all, was very nearly watchable "raw", and with skiploopfilter on, almost
never glitched. I used to avoid high-bitrate 1080s like the plague; now I'm gonna have to grab a few and test them out!
I'd like to figure out why the boot process is burping at that point, given it
seems to have all the tools it needs to continue, but I'm sure that can be ironed out eventually.
Quagga, I very much appreciate your suggestions, actually...any help is appreciated.
Honestly, it was pretty dim of me not to back up the stick using selfimage, or dd or something, before pulling a change of this magnitude. Well, live & learn (to not troubleshoot/tinker at 3am.

)