Visual aides do indeed work. I understand exactly what you're seeing and what you've done. Now just to explain it to you so you can fix it. The key was your comment "(Note, if I remove the "Ctrl acts as Command key" setting, I can not use CTRL-C and CTRL-V in other apps at all." Also, I assume in your post where you said Ctrl-x in pico you really did a ctrl-o.
You want to do the following (make sure I understand):
1) Use CTRL-C/V/X in any Mac application for copy/paste/cut
2) You also want to be in the terminal program and use CTRL-whatever as you're used to.
3) While in the terminal program and using say pico, type CTRL-X to exit pico as an example.
Assuming I'm correct, here's whats happening:
1) On a Mac, Command-C/V/X do copy/paste/cut
1a) On our minis with DellEFI or NetbookInstaller the keys are mapped as: Alt = Command, Windows = Option, Control = Control, Menu = Option [Menu is 2 keys to the right of spacebar]
1b) You've modified that with double command to be: Alt = Command, Control = Command and Windows/Menu are untouched = Option
1c) You can now type Control-C/V/X and copy/paste/cut in any Mac application. This is because Double Command has mapped the Control keyboard key to be a Mac Command key.
1d) When in terminal, which is just another program as far as Double Command is concerned, the Control key is still mapped to be a command key and as 1b) above you don't have a control key. So when you typed ctrl-o to save, you got a command-o which is Open dialog.
2) I suggest you:
2a) Disable double command or at least disable 2 checkboxes you have now: Enter acts as command, control acts as command. You really don't want Enter as command in any case, so uncheck that one.
2b) Go to Keyboard prefs pane, select 2 items: Control key and choose Command, Command key and choose control. You can do this in double command if you want, also applies to all my following Keyboard pref pane suggestions.
2c) Now you use the key in the lower left corner (control) as the command key in any mac application.
2d) When in terminal you can use Control whatever to do Mac things, not so useful and the Alt key as control. So to exit pico you type alt-x.
2e) Optional, when in the keyboard pref pane make the caps lock be a control key. Now when in terminal you can type CAPSLOCK-X to exit pico.
2f ) Optional option, if you do 2e) you might want a caps lock key, you can make the command key (which is the Alt keyboard key) be the caps lock key instead of the control key as 2b) above
Doing all these yield a keyboard that maps as
Control A S D
Shift Z X C
Command Fn Option CapsLock Space Bar CapsLock Option Command LEFT DOWN RIGHT
I have my desktop Macs setup with the standard Mac mapping, control on lower left and Command next to space bar, Option to left of Command. But I have the mini mapped as above. This is because I use the mini more often held in my hands like a PDA vs flat on a surface and its much easier to use my thumb to type Command-whatever in applications because I don't have to either stretch to get to the Alt keyboard key or let go to get it but just thumb up to the Control keyboard key.