Symptom
In the Panels environment, application icons appear as a large, pink letter "M".
Solution
Clear the custom icon from the font.
1. Drag the font out of the Fonts Folder to the desktop.
2. Select the font and choose Get Info from the File menu.
3. Select the icon in the Get Info window.
4. Choose Clear from the Edit menu. The custom icon should disappear and the font should appear as a suitcase.
5. Drag the font back to the Fonts folder.
6. Repeat this procedure for all fonts with custom icons.