Sorry for the triple post but that wasn't the end of my problems and I think this is important. After finding out that some permissions were at fault in the Library folder, I went ahead and repaired them. I then discovered programs weren't launching right as there was a 3 second delay and a spinning beachball. Same thing happened when switching apps.
I restarted a couple of times to see if it would free something up but no. The last thing I could think to do was to delete all my caches (including system caches). To do this I used SYSTEM OPTIMIZER X and after rebooting, everything seemed fine.
However, I launched my system prefs again as a test to see if the delay was still there and I found that although the delay was fixed, my network preferences had messed up again. Sure enough my /Library/preferences folder was displaying wrongly. I quickly went to my disk utility to repair permissions again and found that not only was /Library/prefs being set wrong but also /Library/caches and /Library/Application Support.
The caches folder makes sense because with faulty permissions, none of my apps could write to it. But I'd been using apps for a while without being able to write to it so perhaps the cache files had gotten out of date. Then when I fixed permissions, the cache files were bad and so slowing down the system.
Ultimately, I reckon the whole problem was caused by System Optimizer X, which seems to be doing something odd with some important Library folders. I'll contact the developer but in the mean time, perhaps avoid it on Tiger for the moment.