After painful investigation, I learned that Drupal was not recognizing the phptemplate.engine file, because a call to readdir() was simply not working properly. It did not return the phptemplate.engine file, until I touched a new file in that directory, and made a subdirectory. I did those two things just to test what was going wrong, and suddenly it did recognize the file.
But still drupal refuses to find other files. So for example I don't see the themes in profiles/custom/themes in my themes list. I suspect something is wrong at my host. Has anyone seen anything like this?
