Dem woes: Unexpected Type-3 record encountered

Just in case you haven't tried this yet, here's the drill:

1) dd if=diskfilename ibs=10240 | \
          m.dmaUSGSread top=1 bottom=400 left=1 right=500 \
              output=dem logfile=log

      Of course you need to substitute the right parms for your area. (I left
       the blocking parm as above.)

2) m.rot90 input=dem output=dem.r90
          rows=400 cols=500 bpc=2

3) Create a region (in UTM coordinates) with g.region, then

     r.in.ll input=dem.r90 output=dem.utm
             dimension=500,400 bpc=2 res=3,3
             corner=sw,37:13N,103:45W spheroid=wgs72

     in the command above you have to give lat-long for a corner of your
      dem using the wgs72 spheroid. The r.in.ll command should create all
     the necessary support files for you. But if you run into problems,
     just run r.support.

Best of luck,

Cliff Behrens