I would say that I am about 50% done with alpha quality code.

Almost there, just finished implementing user registration.

-Security credentials do not carry over when switching from main to the ACP panel. Requires you to login everytime.

-Rebuilding of the default theme doesn't seem to work though it says it was rebuilt successfully. I tried changing the header image but no changes took place. (Edit) I see that we're not using the theme/default/images directory, I found an "images" directory in the root of my web. files.

-Cannot register new users. Missing Captcha generator.

Funny, I though I had removed that call. You can replace the offending line with the following:
$data['html_body'] = $this->parser->parse('fud/post.php',$data,true);

Be aware that smileys will not render correctly (that fix_relative_urls function was there for that purpose).