I had to rebuild my kernel in order to get ATI's proprietary drivers to work (there were unresolved symbols in the fglrx module to do with ACPI, which I don't use).

No big deal, I have built the kernel hundreds and hundreds of times in the last ten years.

However, now it will not mount anything via loopback:

[root/] mount -o loop -t iso9660 /backup.iso /mnt/fedora
ioctl: LOOP_SET_FD: Inappropriate ioctl for device

I diff'd my config with my old config, but the loopback choices are all there, and loop.ko loads.

I googled around for this error and found a few threads here and there going back some years, but they are all unresolved.

FC10-64 kernel 2.6.29.2

Strange.
Does /dev/loop* still point to the same device?

What are the differences?

Well, I can tell you what fixed it. I recompiled again, this time I thot I'd try and make the ACPI stuff a module; you can't, but I noticed that most of the things included by default with ACPI cannot apply to desktops (AC adapter, battery, et. al) so I unchecked those and went for a more minimal ACPI set-up.

Now the loop device is okay. Go figure.