Yesterday I picked up my iBook, and everything seems to work just fine.
All the data is there, and talking to the tech person, he mentioned that he took it all apart to replicate the disk, and then when he put it back together and run tests in a loop for 8 hours, found no errors or problems.
His theory is that it might have been that the HD somehow got a bit disconnected or something of the sort. And from his comments, it seems that he has seen similar problems with a couple of other Powerbooks that had similar apparent HD failures.
I am using rsync to backup my important data to the external HD hooked to my Linux box at home, it has gone through about 15GB so far, and still has some time to go.
Learned the lesson, and added a crontab job to backup my home dir on the iBook to the external HD once a week.
Meanwhile, as always, my old Sony laptop hums along running Linux.