If the market is going back to the old version adb into the phone and look in /system/app.
I bet you find the old market code in there.
If there's anything with the name "com.*" in the /system/app directory, you DID NOT clear the /system directory. There are
no files with that prefix in the current load.
There were in the previous ones.
This is what should be in there:
Code:
ADWLauncher.apk GoogleQuickSearchBox.apk
AccountAndSyncSettings.apk GoogleServicesFramework.apk
AndroidTerm.apk HTMLViewer.apk
Androidian.apk LatinIME.apk
ApplicationsProvider.apk LatinImeTutorial.apk
Bluetooth.apk LiveWallpapers.apk
BooksPhone.apk LiveWallpapersPicker.apk
Browser.apk MagicSmokeWallpapers.apk
CMParts.apk MarketUpdater.apk
CMScreenshot.apk MediaProvider.apk
CMStats.apk MediaUploader.apk
CMUpdateNotify.apk Mms.apk
CMWallpapers.apk Music.apk
Calculator.apk NetworkLocation.apk
Calendar.apk OneTimeInitializer.apk
CalendarProvider.apk PackageInstaller.apk
Camera.apk Pacman.apk
CarHomeGoogle.apk Phone.apk
CertInstaller.apk PicoTts.apk
Contacts.apk Protips.apk
ContactsProvider.apk RomManager.apk
Cyanbread.apk Settings.apk
DSPManager.apk SettingsProvider.apk
DefaultContainerService.apk SetupWizard.apk
DeskClock.apk SoundRecorder.apk
Development.apk SpareParts.apk
DownloadProvider.apk Stk.apk
DownloadProviderUi.apk Superuser.apk
DrmProvider.apk SystemUI.apk
Email.apk Talk.apk
FOTAKill.apk TelephonyProvider.apk
FileManager.apk ThemeChooser.apk
Gallery3D.apk ThemeManager.apk
GenieWidget.apk TtsService.apk
GoogleBackupTransport.apk UserDictionaryProvider.apk
GoogleCalendarSyncAdapter.apk Vending.apk
GoogleContactsSyncAdapter.apk VisualizationWallpapers.apk
GoogleFeedback.apk VoiceDialer.apk
GooglePartnerSetup.apk VpnServices.apk
Nothing else.
It's also possible you have a data incompatibility (e.g. some app in /data is causing trouble); if so the only fix is a factory reset (which will force you to reload all your apps.)
I'm loading new versions 2-3x a day here (sometimes more) and haven't run into any problems with the market since I put up the version with the fix in it.
I've been running this code now since the weekend with the only interruptions being the times I needed the GPS (when I swapped back to the base Froyo load.) It's not perfect but I haven't seen anything like that.