Since there's a game destroying bug, I figured that a link or two on that might help folks.
Basically, if you start up BL2 and see the game searching for a character file instead of automatically loading your character, use the XMB or the Xbox button to quit the game IMMEDIATELY. Loading into the game and allowing it to save seems to over-write most of the useful stuff - skins, badass ranks and so on will all be gone. However, your progress in badass challenges will NOT be gone, meaning that you're pretty much hosed unless you weren't playing with them.
Here's a Joystiq article about it which includes video:
Borderlands 2 bug wipes Badass ranks, chievos, across all platforms | Joystiq
You'll note that at the end of the video, an NPC in the game says, and I quote, "We're screwed." Even the NPCs in the game recognize how totally borked this poor guy is.
Here's the Gearbox thread:
Badass rank reset to 0, skins lost, but challenge progress remains. - The Gearbox Software Forums
In a quick glance at it, it sounds like the problem stems from playing split-screen and cloning a profile, as this detailed post suggests:
The Gearbox Software Forums - View Single Post - Badass rank reset to 0, skins lost, but challenge progress remains.
Likewise, it sounds like part of the problem, as I get deeper into the thread, may also be starting a co-op game and then switching to single-player. However, it seems pretty clear that split-screen cloning and co-op games are not all that's involved, because some posters report that they didn't play split screen or co-op.
This seems to be the only fix at the moment, which is the source of the comment above about immediately quitting the game using either the PS3 XMB or Xbox Guide button (turning the console off might also work):
Badass rank reset to 0, skins lost, but challenge progress remains. - Page 30 - The Gearbox Software Forums