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I was messing with the sound system the other day trying to get it to work correctly across all aplications. Ha. Like that is ever going to happen. I will leave my growing rant about the awkwardness of sound under Linux for another day though. Some how something broke in KDE and I started to get no system notifications (not that I use many) but all the other sounds applications, such as xmms and artsplay, worked fine. I assumed that I had screwed something up but in actual fact it seems to be a long standing bug in KDE. The fix is quite simple and detailed below. The bug affects KDE 3.3 and I have seen people suffering from it on earlier versions. I suspect it also affects 3.4 as well.
There is a file (~/.kde/share/config/knotifyrc) which should contain the following content (amongst other things):
[StartProgress] Arts Init=true KNotify Init=true Use Arts=true
for some reason one or more of those true's gets turned into a false and KControlCenter is unable to set it back to true. Simply changing the ones that say false to true saving the file then logging out and back in will fix all the problems.