Okay... Here is how it was fixed for me:
- Go to Printers under System Preferences
- Right click on the left-hand side printers box, and click "Reset Printing System..."
Voila! It will delete all your printers, but CUPS works afterwords.
This is somewhat releated to the issue where you go to add a printer and the list of drivers is totallyblank. The Reset Printing System option brings that back too.
I suspect the Lion upgrade is what actually broke it in the first place.