This is for anyone searching for the answer to this problem- the rest of you can ignore it.

If after upgrading wordpress from 2.0 to 2.0.2 or from 2.0.1 to 2.0.2 you get this error message:

Parse error: parse error, unexpected ‘<' in /home/"user name"/"folder name"/wp-includes/functions.php on line 904 there is a good possibility your ftp application (I use Transmit on a Mac) was set to upload "Binary" instead of "auto detect" Although the site seemed to work with the old "functions.php" file- I'm pretty sure there was something broken that I didn't have time to find. Hope this helped.