iPhoto 9.4.2 failing to load pix...menus greyed out

Hello all.

I have a seven-year-old Mac Pro (2 x 2.66GHz Dual Core Intel) running OS X 10.7.5 and I've tried everything to fix this problem.

It arose when iPhoto (9.4.2) crashed as I was dragging and dropping a jpeg file into it from my desktop.

Now when I launch iPhoto it loads partially but won't load pictures and most of its menus are greyed out as below.

To fix it I have tried the following...

1. Uninstalled and reinstalled iPhoto after downloading a new one from the App Store

2. Dump the iPhoto plist files in /private/var/db/receipts folder.. are there any more I don't know about?

3. Reinstalled the OS via recovery disk

4. Installed a NEW OS 10.7.5 on one of my drives, used that a start-up, ran iPhoto from its original location... and it WORKS.

I am reluctant to move everything to the newly-installed OS but will if necessary.. but I'm fascinated to know if is there a simpler solution to this mystery?

All help gratefully appreciated!