Your /etc/xdg/applications.menu has an extra '</Menu>' at the end, which is 
probably why it doesn't work. This is backed up by the error you got when 
running alacarte:
'** (alacarte:3340): WARNING **: Error loading menu layout from 
"/etc/xdg/menus/applications.menu": Error on line 174 char 8: Element 'Menu' 
was closed, no element is currently open'

Could you please attach your /var/log/dpkg.log and
/var/log/apt/term.log?

To be honest, it is going to be very difficult to work out what happened
to your menu configuration.

FYI, if you need to restore the menu configuration, then
/etc/xdg/menus/applications.menu is part of the 'gnome-menus' package

-- 
Applications menu content got erased
https://bugs.launchpad.net/bugs/247811
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