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I think that Ryan raises a really good point.Its interesting to ask the question - "Howdoes a given therapy affect the Brain." But we should not get caught in thetrap of assuming that tracing physical correlates is going to reveal the "real"nature of Mental Health and illness.  Asyou said we can assume that every experience has physical correlates in thebrain - and that every experience changes the brain.   So we can ask other questions:

Forexample how does meditation or prayer affect the brain?

Howdoes diet affect the brain?

Howdoes playing piano affect the brain?

But to really be effective in mental healthwe are always going to be forced back to dealing with both the brain and thesubjective experience of the story teller.

As for what this suggests for next generationof therapies - we should always be curious about how small changes in the braincan cause significant changes in the storyteller.  See this fascinatingarticle regarding how ovarian cysts were shown to cause schizophrenic symptomsin young women.

But we should remember that while a troubledstoryteller may be caused by an ovarian cyst, a bump to the head, a stroke, theloss of a loved one, abuse, or a host of other causes - that originate in thesocial or physical world - the story-teller is on some level what makes usuniquely human. 

To really define mental health and mentalillness - I think we have to continue talking about the storyteller even incases like my father's where the root cause of the illness could be clearlytraced to a very clearly identified problem with a brain structure.