I guess the main problem is that you tried to install your
own version of xvi. In a normal teTeX installation, all paths
are found by looking at /usr/share/texmf/web2c/texmf.cnf
(or wherever teTeX is installed). The settings in lilypond-profile
rely on this, which makes it possible to all the LilyPond-related
paths by just adding an extra texmf-like tree. This is done by
setting the TEXMF variable. The music-drawing-routines.ps is
normally found in usr/local/share/lilypond/2.*.*/tex/
(make install gives you two copies of the file, as Ferenc has
pointed out).
It seems that you followed the instructions in the reference manual
to install a newer xdvi. However, this requires some care to make
sure that the new xdvi works well together with your existing teTeX.
It's probably easier to install the full teTeX version 2.x, which
contains xdvik version 22.40v, that is fully capable of the
point-and-click feature that probably is the reason you installed
a newer xdvi.
In the texmf.cnf file for teTeX 2.0, I found the following lines
that may explain why your xdvi doesn't find the correct paths:
% support non"k"-xdvi:
PKFONTS.XDvi = .;$TEXMF/%s;$VARTEXFONTS/pk/{%m,modeless}//
VFFONTS.XDvi = .;$TEXMF/%s
PSHEADERS.XDvi = .;$TEXMF/%q{dvips,fonts/type1}//
TEXPICTS.XDvi = .;$TEXMF/%q{dvips,tex}//
If this still doesn't work and you insist on keeping your xdvi 22.81,
you probably want to fiddle with the PSHEADERS or TEXPICTS variables
instead of XDVIINPUTS.
/Mats