Maybe this is something to do with why the 0.7 code fails but the 0.6.9 code works

The following code appears to be the default settings for a newly initialized avatar.
Conspicously they have turned *off* the default which equals BAKE AVATAR = YES and reset it
to BAKE AVATAR = NO. That appears to suggest in my mind that this hands off the baking
mechanism to the viewer and THUS it's impossible to get a baked avatar (i.e. it will always be a cloud)
unless the viewer bakes the textures and then sends them up to the server.
clutching at straws but this might be it, since it appears to be in the zone of where I think the problem is and it's also exactly the opposite of the way it worked in 0.6.9 where it *did* work.

http://opensimulator.org/viewgit/?a=commitdiff&p=opensim&h=9668fb4e31c612ce457fc4d6e7708ea43234dbac

The relevant lines of code are the following where in the old code it was m_serial = 1 and it's now set to m_serial=0. I don't know what serial means but it *may* have something to do with it.
- protected int m_serial = 1;
+ protected int m_serial = 0;