diff --git a/wp-admin/includes/schema.php b/wp-admin/includes/schema.php
index 897fa9d96..437a4ea60 100644
--- a/wp-admin/includes/schema.php
+++ b/wp-admin/includes/schema.php
@@ -353,7 +353,7 @@ function populate_options() {
 
 	// Delete unused options
 	$unusedoptions = array ('blodotgsping_url', 'bodyterminator', 'emailtestonly', 'phoneemail_separator', 'smilies_directory', 'subjectprefix', 'use_bbcode', 'use_blodotgsping', 'use_phoneemail', 'use_quicktags', 'use_weblogsping', 'weblogs_cache_file', 'use_preview', 'use_htmltrans', 'smilies_directory', 'fileupload_allowedusers', 'use_phoneemail', 'default_post_status', 'default_post_category', 'archive_mode', 'time_difference', 'links_minadminlevel', 'links_use_adminlevels', 'links_rating_type', 'links_rating_char', 'links_rating_ignore_zero', 'links_rating_single_image', 'links_rating_image0', 'links_rating_image1', 'links_rating_image2', 'links_rating_image3', 'links_rating_image4', 'links_rating_image5', 'links_rating_image6', 'links_rating_image7', 'links_rating_image8', 'links_rating_image9', 'weblogs_cacheminutes', 'comment_allowed_tags', 'search_engine_friendly_urls', 'default_geourl_lat', 'default_geourl_lon', 'use_default_geourl', 'weblogs_xml_url', 'new_users_can_blog', '_wpnonce', '_wp_http_referer', 'Update', 'action', 'rich_editing', 'autosave_interval', 'deactivated_plugins', 'can_compress_scripts',
-		'page_uris', 'rewrite_rules', 'update_core', 'update_plugins', 'update_themes', 'doing_cron', 'random_seed', 'rss_excerpt_length');
+		'page_uris', 'update_core', 'update_plugins', 'update_themes', 'doing_cron', 'random_seed', 'rss_excerpt_length');
 	foreach ($unusedoptions as $option)
 		delete_option($option);
 }
diff --git a/wp-includes/rewrite.php b/wp-includes/rewrite.php
index c04c6a7ea..6eecf6a5a 100644
--- a/wp-includes/rewrite.php
+++ b/wp-includes/rewrite.php
@@ -1607,11 +1607,11 @@ class WP_Rewrite {
 	 * @return array Rewrite rules.
 	 */
 	function wp_rewrite_rules() {
-		$this->rules = get_transient('rewrite_rules');
+		$this->rules = get_option('rewrite_rules');
 		if ( empty($this->rules) ) {
 			$this->matches = 'matches';
 			$this->rewrite_rules();
-			set_transient('rewrite_rules', $this->rules);
+			update_option('rewrite_rules', $this->rules);
 		}
 
 		return $this->rules;
@@ -1822,10 +1822,10 @@ class WP_Rewrite {
 	 *
 	 * @since 2.0.1
 	 * @access public
-	 * @param $hard bool Whether to update .htaccess (hard flush) or just update rewrite_rules transient (soft flush). Default is true (hard).
+	 * @param $hard bool Whether to update .htaccess (hard flush) or just update rewrite_rules option (soft flush). Default is true (hard).
 	 */
 	function flush_rules($hard = true) {
-		delete_transient('rewrite_rules');
+		delete_option('rewrite_rules');
 		$this->wp_rewrite_rules();
 		if ( $hard && function_exists('save_mod_rewrite_rules') )
 			save_mod_rewrite_rules();
diff --git a/wp-includes/version.php b/wp-includes/version.php
index 0c555a24d..c41bbe5bb 100644
--- a/wp-includes/version.php
+++ b/wp-includes/version.php
@@ -15,7 +15,7 @@ $wp_version = '2.9-rare';
  *
  * @global int $wp_db_version
  */
-$wp_db_version = 12024;
+$wp_db_version = 12060;
 
 /**
  * Holds the TinyMCE version