Dave,
First off, let me thank you for the EXCELLENT project description. Good descriptions are very hard to find on sites like freelancer.
Based on my reading, you need a couple of things to happen.
First, redirect all /catalog/* URLs to / -- the basic logic for that is a blanket redirect with regular expression -- something like (this sample is out of my head, and may need some tweaking)
RedirectMatch permanent ^/catalog/(.*)$ [login to view URL]$1
This will basically "move" your old URLs in /catalog to the same URL in /.
Secondly, shift old style URLs to "friendly" URLs -- that can usually be done in a few powerful rewrite rules.
Third, I'm guessing here, but is it possible that some regular expressions might clean up your existing .htaccess rules. Maybe there are a lot of hard-coded manual rules?
That's a start...
I have been building AND hosting websites for almost 15 years, so dealing with PHP, Apache, SEO, clean URLs, etc is all part of my daily work. (Including a few OSCommerce sites ;-))
I charge $65/hr -- I bid 4 hrs on this task, just to hit the minimum bid amount, but it is possible we can make a big impact with 1-2 hours and go from there.