As you might wonder why the Preview is broken in Theme Directory, the reason is only partial compatibility with WordPress 2.6. Everything works great if you don't change the location of your WP-CONTENT folder.
Since Theme Directory preview uses WP 2.6 and most likely has changed location of this folder, that's the reason for a broken preview, CSS is not loaded properly. CSS depends on user settings, and loading these settings rely on the ability to load wp-config from CSS file.
Since the WP developers have not yet provided proper way to load config, this remains a big problem for many of the plugins and themes that need to load wp-config. As far as I know NextGEN gallery also doesne't work properly in such case (fail to load tinymce3 button plugin).
I have already made a post about this, but no replies from developers yet. Hopefully, we will be able to find some workaround this problem.
Starscape Theme creator