I am running ubuntu 8.04 and I installed the free version of world of goo. I played all of the first chapter where it said that I needed to buy the Full Version to continue. So I did. This made me start a new game which I did and then I finished chapter one once again and it is still saying that I need to buy the full version. Any ideas?

Your computer may still be running the demo since that's what it had done before. I'm no expert at this stuff, but it may help to delete both the demo and full version, then download the full version once again.

How do you start the game? The demo should be clearly named "World of Goo Demo" in the application menu. So if you install the demo first and then the full version, you'd have two games in the menu and you need to be careful to click the right one. (Of course, once you bought the game, it makes more sense to just uninstall the demo version).

Also, upgrading to the full version should not make you lose your game progress. Your progress is saved in your home directory, so as long as you play as the same user, you should be able to install/deinstall/reinstall any version of the game without losing progress.