Comment 2 for bug 379789

I've much more experience now, and can see a simpler and more effective way to repair or recover from a system failure. Here is the principle.

Identify which partition was root, or all partitions in a given install that were used and not /home. Ignore /home for the following.

Determine if a recovery is being requested (just system files and folders) or a full restore (include all configuration files). If a recovery, use a normal install with the same designated partitions and same file system, and follow normal install process as though following the manual partitioning route.

For a full restore, do this before following the normal install process as above:

mount the non-/home partitions as /mnt/mp, or the / partition as the same, but avoid /home for the following:

use rm -R /mnt/mp/folder repeatedly for all folders in / for the mounted partition except /home. That will delete all configuration files as well, except any placed under /home in the user accounts.

you should also use rm /mnt/mp/file if any files are here as well.
Note. Depending on how the LiveCD actually works, you may want to exclude /cdrom and others as well. I think the most critical one to remove is /etc, which holds many of the configuration files.

That's it. You can now repair (back to the install point, but with configurations settings retained), or replace (back to the install point, getting rid of configurations settings as well) your system while keeping the user accounts intact. I've done this a number of times, it works well, and I don't see why it has to be made harder.