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rbertram, my heart goes out to you, as I have experienced exactly the same problems. Here is what I leanred:
1. DO NOT trust the built in backup utility. Even if the backup operation is successful, the restore, at least in my case, fails at 99%. How is that for the definition of evil on earth?
2. Activesync does not back up your storage cards. You should manually create copies of them on your PC.
3. Before commencing the restore operation, make sure that in Activesync options, under "rules", you choose that in cases of conflict always copy from your PC to the Mobile Device and not vice versa. That will help a little. If during the first sync you are prompted to decide whether to merge the two databases or choose one over the other, it is best to combine them and then eliminate the duplicates, either manually or through the "Outlook Duplicate Remover" (nice little freeware, do a search for it). At least you don't lose info.
Finally, nothing is lost. If Outlook decided to erase its entries because the date of the Axim's empty files is newer, all the data will simply be moved to the deleted items folder, from which you can easily enough move it back.
It's never fun, but at least you can avoid catastrophes.
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