Do not Factory Reset your Rooted Android Phone (and how to fix it)

So I did it; I hit Settings -> Privacy -> Factory Reset on my rooted LG Optimus V Android 2.2.1 phone (despite having read that one should never ever do this to a rooted Android phone).  Phone tried to reboot, but got stuck in a loop at the Custom Recovery (a bootup menu).  In other words, I bricked the phone - or at least softly so, because there is a solution, which is particularly easy if you have/had a Custom Recovery installed.  This is what I did:

1. Powered off the phone.
2. Moved the SD card from the phone to my notebook.
3. Downloaded Xionia_CWMA_12518.6_VM_Recovery-signed.zip [5,068,663 bytes]
4. Copied the above ZIP file to the root of the SD card.
5. Moved the SD card back to the phone.
6. Start the phone by holding down Home + Volume Down, and then the Power button (until LG logo appears).  This will boot the phone into recovery mode.
7. In the recover menu, select 'install zip from sdcard' (navigate with Volumn Up/Down, Back and Camera keys).
8. Select 'choose zip from sdcard'.
9. Select 'Xionia_CWMA_12518.6_VM_Recov[...]'.
10. Confirm the installation by selecting 'Yes - Install  Xionia_CWMA_12[...]'.
11. Phone will now be reflashed (fast; a few seconds) while displaying:
    -- Installing: SDCARD:Xionia_CWM
    A_12518.6_VM_Recovery-signed.zip
    Finding update package...
    Opening  update package...
    Verifying update package...
    Installing update...
    *-* Flashing Xionia CWMA 12518.4 VM Recovery *-*
    -------------------
    Done!
    Install from sdcard complete.
12. Hit Back key and select 'advanced'.
13. Select 'Fix Recovery Boot Loop'.  Screen will go black and phone will reboot.
14. Phone will start up the default Android image.

Although it's the default Virgin Mobile LG setup, everything works, i.e. WiFi, 3G and phone calls. Phew!

Since I've previously done a full Nandroid backup using the Custom Recovery, I could also restore the ROM image to the most recent backup I've done by:

1. Power off the phone.
2. Boot up the phone in Recovery mode (Home + Volume Down & Power buttons).
3. Select 'backup and restore' in the Recovery menu.
4. Select 'Restore'.
5. Select '2012-05-13.03.52.34/' (that was my last backup)
6. Confirm by selecting 'Yes - Restore'.
7. This will reflash the phone (taking a few minutes) while displaying:
   Xionia CWMA v1.2518.6
   Checking MD5 sums...
   Erasing boot before restore...
   Restoring boot image...
   Restoring system...
   Restoring data...
   Restoring .android_secure...
   Restoring cache...
   sd-ext.img not found. Skipping r
   estore of /sd-ext/
   Restore complete!
8. In the recovery menu, select 'reboot system now'.
9. The phone will startup with the ROM and settings you had when you did the backup.

Awesome!  Phone is back to what it used to be.