[Jeff Sayre]

As this issue is quite perplexing, perhaps we should keep the discussion here instead of via PM. That way, others can benefit as well.

You mentioned in one of your PMs that both your BP installations are active. This means that you cannot start over with a clean MySQL table.

However, for purposes of isolating this problem, can you create a third installation on your live server. This way, we will know whether or not an absolutely clean, vanilla install (new MySQL DB, new WPMU and BP install using the default BP theme with no 3rd-party plugins) works on your server environment, works on the server your web host has provided to you.