I can't speak to the playlists problem, but it sounds to me like the empgps script is completely bypassing the empeg's init. (I've never seen it, as I don't have a GPS receiver. Can someone post the script real quick?)

As far as developer/consumer goes, the only difference, I believe, is outside the realm of the kernel, and, therefore, outside the realm of Hijack. You have to install a developer image in order to be able to get to a shell. (You might also try the telnetd -- it might work with a consumer image, but, then again, it might turn out to be impossible to create the devices it requires.) Also, installing a new image on your empeg will delete your entire root partition, which means that your /etc/preinit.d scripts will go away and you'll have to reupload them, so make a backup first.