didn't get any response to my question - but for the benefit of anyone else who encounters same problem: ended up backing up all the data, erasing and clean installing Tiger - all runnning sweetly now.
The circle with a slash through it doesn't say it's thinking, it says "no bootable system found". Sorry that I didn't see your question before... There could've been some things you could have done. One among them: Start with the option key down, could've shown you whether there _was_ a bootable system... Glad you were able to backup.