It seems that xfs makes the font.dir files on every boot or every time that
the xfs start script is run.  I installed sharefont and freefont for the
gimp as it uses them in some of its scripts as defaults. I then used xset
+fp to add them in my current session and added them in to the
/etc/X11/fs/config filesystem. The fonts were installed in
/usr/X11R6/lib/X11/fonts. They worked that night. When I restarted the
system and tried to access the fonts the gimp scripts failed. *gimp scripts
= xtns->script fu->logos (pick one) they all filed if I used the default
font. I did an rgrep and found that mkfontdir is run on boot in the xfs
script.
My current workaround is by installing them in /public/fonts and then
running xset +fp when I start gnome (part of gnome startup).

I looked at the xfs script and it looks like it is supposed to check if the
fonts.dir exists and it still overwrites the fonts.dir for the freefont and
sharefont.  The mere fact that it overwrites the file is not the big
issue.  The big issue is that when it does overwrite these files it creates
a zero byte size file for the freefont and sharefont directories.