I have the same problem as YairD, I am running WP 3.0 with Multisite, with subdirectories.
The main website works ok, with permalinks and everything; the subdirectory sites show no theme, and their backend/dashboard give a strange “page not found” page (but not quite the regular 404).
Exactly the same, there is no theme even if I go to Super Admin>> Sites>> user edit and select the checkbox, nothing changes. If i click on backend, or login with the user account instead of Admin, I can’t get into the backend/dashboard for that user’s site/blog. It says “page not found”.
can someone help pls!?