Since 10.6.4 Trash Doesn't Function

A bit more info could narrow the possibilities somewhat.
E.g., what *does* happen when you try to trash an item?

Considering that you have restarted a few times, odds favor the "you are not the owner of your ~/.Trash directory" scenario.

Could you list the folder with Terminal.app for us?

ls -alOe ~/.Trash

If the second line has "root" (or any name other than yours):

drwx------ 2 root staff - 68 Jun 23 18:46 .

...then the cure is usually something like:

sudo chown $USER ~/.Trash

...followed by a Finder relaunch.

But you should probably show us the listing anyway, to be sure nothing else is causing the access problem.