I've just had a similar nightmare in UDK for the last 20+ hours. At first, my tree models were loading okay but they weren't painting in the terrain editor properly. Then, the textures were getting corrupted or something and every time I tried to save the package, UDK crashed. I have gone through this about 100 times now. Moreover, I was just having the same problem with the tree models not showing in the speedtree editor window. The browser would say it contained 4 tris, but 16,786 verts or whatever. I am now able to save a brand new model and it showed up after reloading the editor.
On a side note, I have never been privy to the fact that you have to save maps and packages somewhere in the UDK directory. Is this why my stuff never shows in the actual game mode? And also why I get a rap-sheet error list telling me that my packages are externally referenced and won't be visible in the game? How come no teacher of mine has ever told me this? Where do I need to save the files in the UDK folder????