To reiterate, there are no problems with Joomla when switching from PHP4 to PHP5. I've gone between the two a couple times and never had to change anything.

Even when using PHP5 with register_globals off, you very easily could still see the warning message about them being enabled. Keep in mind that Joomla has a feature to emulate register_globals even when they're disabled in PHP, for backward compatibility with older modules requiring it.

Double check the 'RG_EMULATION' setting in your globals.php and make sure it's set to false for best security. If you're using any modules that depend on that setting, uninstall them and find a better alternative.

/**
 * Use 1 to emulate register_globals = on
 * WARNING: SETTING TO 1 MAY BE REQUIRED FOR BACKWARD COMPATIBILITY
 * OF SOME THIRD-PARTY COMPONENTS BUT IS NOT RECOMMENDED
 * 
 * Use 0 to emulate regsiter_globals = off
 * NOTE: THIS IS THE RECOMMENDED SETTING FOR YOUR SITE BUT YOU MAY
 * EXPERIENCE PROBLEMS WITH SOME THIRD-PARTY COMPONENTS
 */
define( 'RG_EMULATION', 0 );