Often happens when acts sign to major labels. Recently happened with Nerina Pallot as well.

The Go! Team had to not so much re-record as remix their album for US release due to copyright concerns and apparently it's made only minimal difference to the overall feel of the record. If a re-recorded version sounds "souless", you have to ask how much soul was there in the first place? After all, it's the same songs, right? The idea of a definitive version of a piece of a piece of music is really only a relatively modern concept, brought about by technology i.e. the ability to record sound. Even now, many composers still toy with the idea of a piece of music that's different every time it's performed but contains an esential core idea or phrase that remains (like Brian Enos experiments with "generative music"). Outside the confines of Indie/Rock, dance music, reggae and soul are far more comfortable with the idea of having no one definitive version of a song. Back in the real world, yeah, some versions of albums are pretty awful, due to being badly mixed, recorded, etc. but unless an artist has totally lost creative control, I think if the ideas are good, they'll still shine through to a greater or lesser extent.