I think I know whats the problem is about. Battery icon *does* starts upgrading, but only after capacity drops below "design", and only in relation to that "design" capacity.

So, for example, if one have 1700 mAh relative capacity, and design is reported (via resistor) as 1000 mAh, battery icon will show full all the time until capacity drops below 1000 mAh, even if rest of the applet report everything (percentage, charge, capacity current and max) correctly. Then, at 500/1700 mAh, battery icon will show half the battery full (500/1000 mAh, took from design), etc.

Everything written above is unrelated to gconf entry about using design capacity - it seems that bug about using design as max capacity for calculating what icon to show is hardcoded somewhere else in the applet.

/Estel