I have for a long time used KeyRemap4MacBook in Snow Leopard. I have always stayed on top of OS update. Today, suddenly my CapsLock no longer was remapped to Control, but it was just a regular CapsLock. So I went into the settings for KeyRemap4MacBook and noticed that CapsLock could no longer be set. Instead it gave a link to PCKeyboardHack. So I downloaded that and tried to use it. But when I try to select the Control key to remap to, it just becomes some kind erratic delete key or something. Definitely not a Control key.
Reading comprehension is important... my defense, it DID WORK for many months without PCKeyboardHack, how I don't know. Maybe I upgraded KeyRemap4MacBook and then did not reboot until now.
Anyway, the solution is to use PCKeyboardHack and then to actually follow the instructions. In particular step 3,``open "System Preferences > Keyboard > Modifier Keys..." and change CapsLock configuration to "No Action":´´