The site is now running on DNN 3.1.1. The upgrade was completely painless. I still can't get friendly URL's to run and I'm convinced it's an XP security related conflict but I don't have any idea where to look.
So far, this site has started out as DNN 3.0.12 and been upgraded to 3.0.13, 3.1 and 3.1.1, all painlessly. The only thing I had to do was restore my code to roll up the menu bar.