After looking at the pic I think without doubt the failure was due to lack of lubrication as there is plenty of red oxide dust visable. One of the side plates failed, the opposite side plate has instantly seen a 100% load increase which it cant handle and has bent as a result. The chain has then run off the sprocket and jammed the drivetrain. Here is an interesting link relating to chain failures.
http://www.renold.com/Renold/web/site/Support/Chain_Troubleshooter.asp

Update:

I got my chain and two sprockets in from Dennis Kirk today.  My clutch pushrod and 3 bolts & nuts for the rear sprocket should be in tomorrow at the local dealer.  I'll also be picking up some chain wax (from Maxim I think) then as well.  A co-worker recommended it, I guess you spray it on after a ride and then it kind of thickens up. 

I managed to get the rear and front sprocket both off.  I only had to use the Dremmel on two of the rear sprocket bolts.  Any other tips and tricks to changing it that aren't in the Clymer (I know for example the float height measurement was a little more clear in the Haynes than in my Clymer)?  Are there any 'initial' things I need to do for a new chain and sprocket set such as break in, extra wax, no wax, etc?

Thanks.

Nothing special for the sprockets, except maybe getting the torque right on the rear sprocket nuts.

But getting the new chain on might be an adventure.  See if this thread helps any.  (Read carefully!)

I discovered a neat little trick the other day to get the chain to link up, maybe ive just been blinded by stupidity or it just doesn't occur to people. When ive taken my chain off (its a split link (master link chain)) ive been putting it back on and been stuggling to get the chain ends to meet up enough to slip the master ling through, well the other day i put the chain back on by rolling it onto the rear sproket at both ends, so the end meet while meshed with the rear sproket, this ment they gap was perfect and the master link slipped in a treat. I dunno whether everyone already does this and ive just been stupid for a long time but it was 100x easier to do.

A good way to get an awkward chain to meet right for the master link is to us a cable tie.
Just put the tie arouns th rollers of the loose ends then click the cable tie tighter until the gap is right for getting the link in.
once done you snip the cable tie and remove.

The GS500 chain tends to be not too bad for this but on other bikes it can be a damn useful trick.

Ok, I got everything put together last night.  My rear tire doesn't spin very freely though- the rotor rubs against the brake pad.  I went for a spin around the block, and everything worked ok except for the rear brake.

The pedal seemed somewhat slack, like I'd press it and not much would happen.  Also, when the bike is on the centerstand the plates are actually rubbing slightly against the rotor.  I was very careful not to press the brake pedal while the wheel was off, and had a small piece of wood between the plates while the wheel was off as the clymer manual suggested.  I'm not quite sure what the problem is.  I haven't found a lot on this board involving this specific problem. 

I was going to make a new thread, but I figured the background info in this thread might be useful.

Thanks in advance.

There's not a lot of "horizontal adjustability" on the rear axle.  Are you sure you put everything back where it came from?

The really shiny silver ring didn't come out when I pulled the axle bolt.  Also on the left hand side I have a v shaped piece of metal that secures the brake to the axle.  I put that between the swing arm and the spacer.

I think perhaps I haven't been to clear, Kerry.  It appears that the brake is always partially closed around the rotor, not that it's rubbing on one side and not the other.  As far as I can tell, both sides are making contact.

Is this something that could be fixed by bleeding the brake system?  Sorry, I'm at work, if I was at home I'd take a picture for you.

The brakes should always make a very slight constant contact with the brake disc both front and back. Its entirely normal. When the chain is on and such if you spin the back wheel it should stop rotating in under a turn if you use average force. The wheel should not spin freely when the brake disc is attached.

Thanks, I got the same response from a guy at work.  I guess I'm just overly paranoid now about safety maintanence issues. 

I guess that about wraps this topic up.  I appreciate everyone's help.  Hopefully anyone that is thinking about putting off chain maintanence comes across it.

--Jared

if the brake is draging AND the peddle needs to be pumped then either you have air in the brake system OR your rear wheel isnt quite aligned right

Well, the fact that the brake needed to be pumped scared me so I turned around and headed home.  Talking to a friend, I figure I must have compressed the brake piston while wedging something in there while the wheel was off.  This is what required the initial pumping. Taking it out again, it's been fine.  And I guess a little bit of drag is normal. I rode it 15 miles this morning to work, and it's rides like a new bike, it's great.

Thanks all.