The PRAM battery will not affect the settings mentioned. It stores very little. Just enough to boot up and get the screen going, basically.
I don't have a definitive answer for you either, msagal, but let me share a little anecdote. I recently lost a bunch of preferences because I thought it would be a good idea to throw away the "~/Library/Preferences/com.apple.systempreferences.plist" file after ProjectBuilder bitched at me about it.
The effect of this was apparently to corrupt my system's Virtual Memory (VM) storage files which I had relocated using a utility called "SwapCop."
If the system loses track of the VM storage all kinds of havoc ensues. Essentially every open application becomes a bull in a china shop, corrupting its open files and trouncing the volume catalog.
So I ended up with a bunch of corrupted preferences, a number of corrupted Mailbox files, and basically had to do a reinstall of my system.
Now in my case it was just a boneheaded move on my part that led to the system falloing apart, but it's not unheard-of for this kind of thing to happen spontaneously.
You should certainly repair your hard drive, preferably by booting from your Mac OS X install disk and running Disk Utility from the installer menu.
As a precaution you might try renaming your personal Preferences folder and then rebooting, which will do two things: (1) recreate default preferences for anything you start, including the system, and (2) allow you to restore preferences for applications that come up and really really need the old settings.
As far as your iPhoto Library goes, the data for that lives in your Pictures folder, in a folder named iPhoto Library. The AlbumData.xml file and the Albums folder are the most critical. As far as I know there is no automated way to recover this information if it becomes corrupted. However, you should be able to at least go through the picture folders (named by year) and locate your images, then re-add them to your iPhoto library by dragging them directly onto the iPhoto window in Organize mode. Before you do so I recommend making a full backup of your iPhoto Library folder and then renaming the iPhoto Library folder to something like "iPhoto Library (old)." All this should be done without iPhoto running, of course.
Sorry to hear about your situation. This stuff can be a bitch to recover from. The best recommendation anyone can make is of course to make regular backups. Especially back up your Home folder.
Good luck!