But if I don't drop to the shell, don't touch anything, it still says cramfs: wrong magic, but boots anyway without any panics. What's going on?
First, it is unnatural for Debian to cry in such a manner. Please let me know the version number of your distro. I think you have used dselect to change your kernel.
One more thing, Satya your machine isn't in trouble. It's just that sometimes automation doesn't work as desired. Nothing is perfect ;).
Regards,
ah