Hi there,
I had the same problem - reverting back to to the restore package and then re-installing the root version DID NOT fix anything.
I did eventually get it working though - rather than adding accounts through the settings page, you just need to add google market using the instructions under "
Android Market Procedure" on the PRS-T1 page.
Once the market is added, you can then add accounts to it that way.
If all else fails, just add apps directly using the .apk files.
Good luck.