sorry, i stepped away...
assuming windows xp...
C:\Documents and Settings\
your username\Application Data\Mozilla\Firefox\Profiles\
random charachters.default
substitute appropriately for the bold text above. deleting this folder will delete all bookmarks, settings, cookies, etc. i'm not sure of the exact path under other flavors of windows or for 'nix.
1Jules... you may want to visit the mozilla firefox forum here:
http://forums.mozillazine.org/index.php?c=4 and check for suggestions. unfortunately the site seems to be down at the moment.
lastly, with firefox closed you could move the following files:
key3.db,
secmod.db and
signons3.txt (signons3.txt if ff v3, signons2.txt if ff v2)
out of your profile directory into a safe place. then launch firefox and see if you get prompted. i believe the files will be recreated fresh. if it works, then all you've lost are the login ids and passwords for whatever websites you've stored. they can be added back as you visit them again.
[...edit...] secmod.db may not need to be moved out, but shouldn't hurt. have a look at:
http://kb.mozillazine.org/Profile_folder_-_Firefox for much info on the ff profile.