On a whim I tried something... in my wordpress 3.0 menu I have created a Custom Link for Home. In the label instead of just writing 'Home' I wrapped it in a span.
<span class="home">Home</span>
and to my surprise that was properly parsed so that now the Home link has a useful span around it!
.sf-menu li span.home{
display: block;
text-indent: -9999px;
background:url("images/skull-n-crossbones.png") no-repeat;
}
with a little css you can whisk away the text and use a background image!! the display: block; is important as the text-indent property doesn't work on inline elements (such as span).
hope this helps!