Apple Support Fixed My Phone

After a couple of calls to Apple Support, a solution was found for my problem. Thanks to Kimberly and Barbara from Apple for the help. To fix your phone do the following:

1. Open up iTunes and take a screen shot of all your applications. You could write them down instead, but I found the screen shot a lot easier.
2. Delete all the 3rd party applications on your iPhone
3. Delete all the 3rd party applications in iTunes
4. Exit iTunes
5. Empty your Trash. Do a soft reset of your iPhone. (Just for good measure)
6. Restart iTunes
7. Download all your applications
8. Resync your iPhone

If you have purchased applications, don't worry. You won't get charged again. The iTunes store remembers what you have purchased before.

I know its a bit of a pain, but it worked for me. Apparently the 3.0.1 update somehow mangled the application files.

Hopefully this post will help the next poor soul that has this problem.