Firstly I'll explain what I know can work, as I'm already doing this on one blog for a friend.
Using WP v2.0.2, I setup a blog for my friend at http://tombammann.homedns.org/vhosts/jordan
I then used dyndns.com to cloak redirect the above url to http://browncatbrowndog.com
In the admin for this both of the install directories are set to
http://browncatbrowndog.com, not the real actual location.
So I buy the domain name, and setup the cloak redirect. I waited a few days for the DNS to settle. I change both the WordPress Address and Blog Address to http://tombammann.org instead of http://tombammann.homedns.org, exactly like I have successfully done on my friends blog.
I then delete the contents of the wp-content/cache directory, and update the permalink structure.
When you go to http://tombammann.org the theme does not load correctly so you just get all text on the screen. To get the theme to load I have to keep the WordPress address as http://tombammann.homedns.org
This then lets everything work fine, except for how the url displays in the web-browsers URL bar.
When you go to http://tombammann.org it loads http://tombammann.org and appears to be fine. However when you click on a post link it loads up the post on the screen, but instead of the url bar saying we are at http://tombammann.org/post-permalink it just says in the url bar that we are at http://tombammann.org
I've tried all of the above process using zero plugins and the default theme, still with no success. I've checked that the .htaccess file is writable.
So my question is that why does it work for my friends setup but not for myn?
I can't recall how I got this to happen, but at one stage all the http://tombammann.org/post-permalink type URL's were working fine, except once in Admin and trying to click on publish post, it had a problem with sending referrals. I went through all the procedure to check that sending referalls are made, and they were.
There must be something else that is changing in the background that I haven't noticed for this to be working so random. Does anyone have any ideas where I could start looking?