I think loosing the background pattern wouldn't be such a bad thing. Go with something like a gradient so that the text is better highlighted. I dunno, I'm still half asleep so my judgment on the background could possibly be unsound.

The background isn't to bad, but a gradient could be useful.

... the whole thing takes up too much space
... the background is "too busy"; you should calm it down a bit
... too many x's ... I'm guessing you will have x's as statusicons etc ... to a viewer it may look like one BIG X .. a BIG X could be a negative thing (eg. cross out)
... minimize your use of fonts; 2-3 fonts max

What's wrong with the knobs?

I say give it a shot with the whole style. Lets see how it looks altogether. Things look different when they finally come together ;)

I toned down the background in the header and added a gradient overlay.

I've been trying to make a style that matches the header, but have been unsuccessful. Can't tell if it's too busy, or the colors don't work, or both. I'm guessing both :)

Any sugguestions?

Actually, I like the style that you have now. It's the Header that needs to be re-worked; it lacks the "umph!" My suggestion is that you re-work the Header so that it utilizes the colors of your forum.

I'm not to fond of the purple, perhaps a black or something would be better?

* Reduced all text to two fonts (3 if you count the 'x')
* Changed color scheme to match existing scheme on the forum
* Altered effects on "LiveXchange" header text, to make it stand out more
* Added radial blur to knobs behind "LiveXchange" header text
* Altered outer background
* Added grid to inner background
* Attempted to fix the log-in button again (any way to anti-alias the 'stroke' effect?)
* Added all main navigation 'links' to main menu bar for spacing purposes

Nice, but the background boxes need to go :p. I had a great idea for this when i looked at it, just can't explain it :confused: