I really don't know what's happened here, I just did `git annex unannex .` in a very large annex:

    unannex Inbox/Lolcat.JPG (Recording state in git...)
    ok
    unannex Inbox/Lolcat.jpg (Recording state in git...)
    ok
    unannex Inbox/May 2012 Photo Stream/120502_0004.JPG (Recording state in git...)
    ok
    unannex Inbox/May 2012 Photo Stream/120518_0005.JPG (Recording state in git...)
    ok
    unannex Inbox/May 2012 Photo Stream/120523_0006.JPG (Recording state in git...)
    ok
    unannex Inbox/May 2012 Photo Stream/120523_0007.JPG (Recording state in git...)
    ok
    unannex Inbox/My boyfriend of 7 years and I are both physicists. Here's how he proposed to me. - Imgur.jpg (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121102_0035.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121102_0036.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121102_0037.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121102_0038.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121102_0039.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121103_0040.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121104_0041.JPG (Recording state in git...)
    ok
    unannex Inbox/Nov 2012 Photo Stream/121105_0042.JPG (Recording state in git...)
    error: bad index file sha1 signature
    fatal: index file corrupt
    git-annex: failed to read sha from git write-tree
    git-annex: git commit [Param "-q",Params "-m",Param "content removed from git annex",Param "--",File "Inbox/Nov 2012 Photo Stream/121105_0042.JPG"] failed
    Vulcan:~/Pictures $ ga unannex .
    unannex Inbox/Nov 2012 Photo Stream/121109_0043.JPG error: bad index file sha1 signature
    fatal: index file corrupt

    git-annex: fd:12: hClose: resource vanished (Broken pipe)
    failed
    git-annex: pre-commit: 1 failed
    git-annex: git commit [Param "-q",Params "-m",Param "content removed from git annex",Param "--",File "Inbox/Nov 2012 Photo Stream/121109_0043.JPG"] failed
    Vulcan:~/Pictures $ ga -F unannex .
    unannex Inbox/Nov 2012 Photo Stream/121124_0044.JPG error: bad index file sha1 signature
    fatal: index file corrupt

    git-annex: fd:12: hClose: resource vanished (Broken pipe)
    failed
    git-annex: pre-commit: 1 failed
    git-annex: git commit [Param "-q",Params "-m",Param "content removed from git annex",Param "--",File "Inbox/Nov 2012 Photo Stream/121124_0044.JPG"] failed

I guess now I'll just try to unlink the symlinks by hand, and drop the `.git` directory?