Gentlemen, I bring great news!
It seems the problem we are facing has to do with the fact that your desktop 
starts before gnome-settings-daemon does (the timing is off).

By following the tips on this thread
http://ubuntuforums.org/showthread.php?t=1594010&highlight=GTK+theme I
managed to fix my problem by simply running this command:

sudo apt-get install --reinstall gnome-settings-daemon

See the thread for details.  Hopes this solves the problem for everyone.

Not sure if because I installed ubuntu on a solid state drive is the
root cause for this timing issue.

-- 
Meerkat (10.10) does not apply theme properly
https://bugs.launchpad.net/bugs/649809
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