I'm having an almost identical issue, I cannot update to 10.10 from 10.04 LTS 
because of the error: 
E:Unable to correct problems, you have held broken packages.

More info on my error is here: https://bugs.launchpad.net/ubuntu/+source
/update-manager/+bug/666063

-- 
E:Error, pkgProblemResolver::Resolve generated breaks, this may be caused by 
held packages.
https://bugs.launchpad.net/bugs/606652
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