What is your theme? Custom or Default?
It happens on both custom and default themes.
Have you a working .htaccess file? mod_rewrite.so installed and enabled? Groups/Owner perms set up correctly to allow necessary file / directories to be read / written to?
can you see the default /about/ page that was created?
If not, mod_rewrite is not reading the htaccess file.
I have found many different pages on setting up the .htaccess and mod_rewrite.so, however none of them seemed to work. As far as the perms go I gave everything 777 in the blog directory to eliminate the ftp as the source of the problem. It still hasn’t worked.
Here is what I have been doing. 1) follow instructions to setup .htaccess and mod_rewrite. 2) setup perms 3) if still not working give 777 to everything. 4) if still not working restore image and start over. 5) do this until you run out of instructions 6) ask for help.
If anyone has any instruction to setup .htaccess and mod_rewrite and vsftpd I will try them. I have tried all that I can find on the web so far.
Run phpinfo() what modules does it list under ‘loaded modules’ your looking for mod_rewrite to be in the list.
After that checks out you want to check your chown settings for directories, it tends not to matter what file permissions you set if the group and owner of the file and directory is wrong. Those file permissions simply set a series of permissions for Group, Owner, and Other but doesn’t set which group / owner.
It’s working! ok here is what you do if anyone else needs help. Follow the instructions here
http://www.lavluda.com/2007/07/15/how-to-enable-mod_rewrite-in-apache22-debian/
make sure to edit the default in the /etc/apache2/default (I think I did default-ssl also) the instructions are wrong and point to /000-default
restart apache2 using “sudo service apache2 restart” not the outdated one in the instructions
Here is my .htaccess file in case yours is blank like mine was.
RewriteEngine On
RewriteBase /blog/
RewriteRule ^index.php$ – [L]
# uploaded files
RewriteRule ^([_0-9a-zA-Z-]+/)?files/(.+) wp-includes/ms-files.php?file=$2 [L]
# add a trailing slash to /wp-admin
RewriteRule ^([_0-9a-zA-Z-]+/)?wp-admin$ $1wp-admin/ [R=301,L]
RewriteCond %{REQUEST_FILENAME} -f [OR]
RewriteCond %{REQUEST_FILENAME} -d
RewriteRule ^ – [L]
RewriteRule ^([_0-9a-zA-Z-]+/)?(wp-(content|admin|includes).*) $2 [L]
RewriteRule ^([_0-9a-aA-Z-]+/)?(.*.php)$ $2 [L]
RewriteRule . index.php [L]
So mod_rewrite wasn’t loaded then? I hope I helped in asking for confirmation that it was or wasn’t it helps to check what phpinfo reports. 
I would change that Debian distro for redhat centos or fedora they have much nicer default configs all geared up for getting of to a fairly quick start as a web server.
Had the same problem on a fresh BP 1.2.8 install on a fresh WP 3.1. Changed theme to bp default, changed permalink settings, made sure .htaccess contained rewrite rules as generated by BP. mod_rewrite was definitely activated. However, the .htaccess in the BP root (a subdirectory under a local domain) was not evaluated at all. Ubuntu 10.04 server edition, everything installed via packet management except for WP/BP which were simply unzipped from the download archives.
This entry in httpd.conf helped:
~~
`
Options FollowSymLinks
AllowOverride FileInfo Options
Allow from all
`
~~
Change the root dir of bp accordingly. After that all the links on tabs, registration etc. worked fine.
