Ok I just installed gentoo linux on my home computer about a week ago. I am still pretty new to it and am only starting to learn my way around. Basically I start the computer, everything loads up ok and checks out, then it takes me to the gui. From there when i try to log in the screen just kinda flashes and prompts me again for my username/password. When I log in there as root however it takes me to a services menu where the only options i can click on are......default/fail safe & cancel.

So then I hit control+alt+f2 or f1 (whichever takes me to the prompt) From there I can log in normally but cant access my files which are in /home/steve. I can only get into those folders if I am in superuser. Otherwise it tells me permission denied. I even went to the processes menu and killed "X" then reloaded but it that didnt do it. I think something is really messed up w/ my permissions or something. Someone please help...

The first part sounds to me like you have your system configured to boot into a GUI environment. You had to manually set this in rc.conf during install or sometime after. Most likely you didn't set a display manager, so it's using the default XFree86 XDM for your login. I would recommend logging in as root, and editing rc.conf, and the line that says "display manager" set that to GDM(if you have gnome installed). In my opinion, if your going to GUI login, that's the best manager. Also, at the bottom of rc.conf it will allow you to set your default window manager, so be sure to set that as well if you like.

On to the permissions, log into your console as root. Then:

# cd /home
# chown username -r steve/

I can't remember if it's -r or -R, but if one doesn't work switch the case. -r tells the command to perform recursively, in other words all the subdirectories and files will change ownership to the user you provide in the command. After you do this you should have no problem at all accessing the files as steve.