So if I get this correctly, the actual dir structure on the system remains as /mnt/dsl/home/[username] but netatalk looks in /mnt/dsl/home/AUTH/[username]?

I wonder if the update made it so that netatalk reads from an afp.conf file in a different location than usual, which is misconfigured with "basedir regex = /mnt/dsl/home/AUTH". Can you please run "netatalk -V" on the command line and check where it's reading afp.conf from?