Hi revlimiter,
Do you need that JavaScript in your searchform? All of that onfocus and onblur. I'm not entirely sure if that's the cause but try removing that and see if it still has the same URL structure.
The input-text tag without JavaScript:
<input type="text" class="text_input" value="To search, type and hit enter" name="s" id="s" />
What the JS does is remove the text "To search, type and hit enter" from the search box when user clicks on it, and bring it back when user clicks out, and it's an inline IF condition.
I'd first try to find out if that is the cause at all. If it is, try outsourcing the JavaScript code to a .js file or at least outside of the form, and only calling it from the form (take a look at this example: http://www.fireandknowledge.org/archives/2006/11/03/clearing-fields-with-javascript/ )
To carry the $postnum count on to following pages, my first thought would be using the global variable $paged which holds the current page number, something like this:
<?php
//Initialize $pagenum
$pagenum = $paged;
//Set 1st page to 1 instead of 0
if($pagenum == ''){$pagenum = 1;}
//Start checking which page is up
if ($pagenum == 1) {
//On 1st page start counting posts from 1
$postnum = 1;
} else {
//On following pages start counting from 11, 21, 31, etc.
$postnum = ($pagenum * 10) - 9;
}
?>
Not sure if this will work, I didn't have time to test it. Give this a try and tell me if it works :)