It works on a new install I just did with the tweak I did to the new install. $newpp_path is indeed set when I do a complete new install which means $$PP_PATH is set.
Honestly do not know specifically what is happening on your end. The next error means there is a problem with your usergroups table.
list( $User['adminedit'],$User['moderator'],$up_k,$useruploads,$usercomment,$ueditpho,$ueditposts,$User['usemod'],$User['highlight'],$User['bold'],$User['italic'] ) = mysql_fetch_row($resulta);
Does that exist in your database.