WordPress MU

Quite simply, in every blog, a 404 error occurs after following a link.

See what I mean by clicking the About link at the top of the following blog:
http://titch.sourdough.net.au/

A 404 error occurs for every link in the blogs, except external links.

Thanks for any help on this.

My htaccess files:
----------------------
RewriteEngine On
RewriteBase /

# Rewrite http://www.domain.com to domain.com
RewriteCond %{HTTP_HOST} ^www.(.*)
RewriteRule ^(.*) http://%1/$1 [R,L]

# force a trailing slash for dirs
RewriteRule !..{2,4}$ - [C]
RewriteCond %{REQUEST_URI} !^.*/$
RewriteRule ^(.+)$ /$1/ [R=301,L]

# uploaded files
RewriteRule ^([_0-9a-zA-Z-]*)/?files/(.*) /wp-inst/wp-content/blogs.php?file=$2 [L]

# subdirectory passthru
RewriteRule !^subdir - [C]
RewriteRule ^(.*) /wp-inst/$1 [L]
---------------------
This one is located in the wp-inst directory:
---------------------
RewriteEngine Off

<Files wp-content/blogs>
ForceType application/x-httpd-php
</Files>

# BEGIN WordPress
<IfModule mod_rewrite.c>
RewriteEngine On
RewriteBase /
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /index.php [L]
</IfModule>

# END WordPress
-----------------

*UPDATE*

By removing this line from the first .htaccess file:

# subdirectory passthru
RewriteRule !^subdir - [C]
RewriteRule ^(.*) /wp-inst/$1 [L]

Everything appears to be working now. Will removing this code have a negative effect?

I use the following for passthru subdirectories:

RewriteCond %{HTTP_HOST} support.daria.be
RewriteCond %{REQUEST_URI} !support/
RewriteRule ^(.*)$ support/$1 [L]