To be complete, I’ll put the solution up here in a main level post, rather than in writebacks to the previous post. My problem was that in my Safari settings I did not have checked the box for “Open ‘safe’ file types after downloading.” It was that simple.
However, in the course of asking the question on Tribe I found a cool tool which I downloaded. It allows you to do exactly what I was talking about before – read, edit and manipulate your MIME type mappings. It was using this tool that I realized my types were set correctly and something else must be the problem. It is called MisFox. It’s freeware and seems to work just fine. It works pretty muhc like the old style Anarchie control panel that later was incorporated into the Mac OS. It lets you set default applications, default applications to handle protocols as well as adjust MIME mappings. Right on!