I lost my job in December - 2 weeks before Christmas. I was a programmer.
I have actually been finding myself inspired by the economic downturn and motivated to pull myself up by the bootstraps. I'm a creative type, and see opportunities everywhere, now that I look. Knitting isn't really efficient enough to pay the bills, but I could teach knitting at local shops. I could create patterns and sell them on the internet.
I'm also putting my programming skills to work, and branching out into possibly an "iPhone" type app that I could go independent with. Almost everywhere needs a website now, almost everywhere needs some IT work now and then - hey, I can do that.
I hear you on the depression front. It's not like someone can tell you to snap out of it and you're magically better. I admit to not being happy at my former job, but I'd convinced myself it was a good place for me, so it was all a shock. And the market is just so saturated with out of work programmers (and everything else) that I haven't heard back from a single application. But things aren't too bad, and at least I'm not driving 45 miles each way, eh? Plus, I've been dealing with some health issues that it's nice to relax and focus on getting taken care of now.
In any case, I'm new to the forum and haven't gotten the opportunity to talk to you much, but in my humble opinion, you should by any means necessary keep your tools. Handiwork is a fantastic release, and I imagine any psychologist will tell you the same. And you *will* improve, just like anything else, it takes time. Dive in and don't look back. You've got a ton going for you right now.
Get out there and do something novel, and people will come!