That looks as expected - seems it can't resolve the UUID. Doing that is (one of) the job of the initrd.
You didn't re-mkfs that partition did you ???.

Try interrupting grub - hit <Esc> to see the menu, then highlight the normal boot selection and hit <e> to edit it. Then change the UUID=... to /dev/hda1 (presumably).
Hit <Enter> to save the change then <b> to boot.

This is a "one-time" change to get you started - not permanent. Just trying to see if you can get going - it'll probably fail when it reaches fstab.

Just got an update notification - for the kernel. Maybe I'll hold off for a day or two ...

I still get

searching for root device ++++*******++++ done
checking root device...
Unexpected failure running fsck. exited with 126

press enter to hald or ctrl alt del to reboot
/etc/init.functions: line 21: chvt: command not found

I didnt do re-mkfs. If mounted the drive is accessible and readable.

So I was thinking is there a way to undo a kernel that was added? Can I extract a kernel from the bootable gutsy cd? If I have to reformat how do I save my settings and programs and stuff. I dont want to go through having to set all that up again. Or do you still have ideas of what to do?

Well I fixed it. Thankfully the programmers behind this all are smart. Now following you temp directions I used the /dev/hda1 instead of UUID and then I also added .bak to the initrd line. It used the backup config and it works now. The problem is I still need to cleanup the kernel compile that failed. How do I do that? Since I am at this point I am going to create an image of my hda1 partition.

Don't know what happened to you - I just did the (64-bit) kernel upgrade, and it worked fine. The debug kernel (which I use for systemtap) died though - write error on the deb. mmmm - I see a bit of traffic on the ubuntu forums re this kernel update; wonder if the devs are spending too much time on the next roll-out and neglecting gutsy.

Maybe select your previous kernel from the boot menu (2.6.22.12 ???), and delete the 2.6.22.14 from /var/cache/apt/archives and try the update manager again.

Note, this is just me musing - I'm not all that up to speed on apt ...

I think what happened is the fact that I tried to compile a kernel and it failed during the mkinitramfs stuff. That is what seemed to be hosed after the update. What I think I should do is remove the 2.6.24 kernel stuff and go back to just using the 2.6.22.14-generic. I am unsure how to undo what I did though.