I'll create a new lvm logical volume, create a file system, and restore from a level 0 dump taken from a lvm snapshot just before things broke.
Ok.
The part I'm not certain about is the grub voodoo to get the system to boot to the lvm with the restored root file system.
Look at ./etc/lvm/backup/* in your dumped files, it will show you the VG, LV and ID. Create your new VG and LV, then edit fstab to reflect or recreate it w/ the same names. Just make sure fstab reflects whats actually in place.
Are there differences in the boot process for CentOS/RHEL 5.x versions that I have to worry about. Would it be better to try to get a closer match between the root file system and the live cd vintages.
No, you're simply booting to env that allows you to create a new FS, this might matter if the recovery env created an FS that was some revision ahead of what your dumped OS uses, but given the info you provided, I think you are fine, give'er and let us know...
jlc