That's... weird. I'll look at the KUAL button thing again, but AFAIR, a full update should pretty much obliterate it without breaking anything...
As for your current predicament, instead of clicking "Update our Kindle", which you can't, just let it go to sleep, the update should run automatically after some time (i.e., exactly like how you get silent official updates, except you're the one providing the files).
Once you get SSH running again, just restore a sane /usr/share/webkit-1.0/pillow/javascripts/search_bar.js
EDIT: Also, double posting is evil

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