MMA7660 accelerometer with ATTiny85
I have run into similar frustrations using standard libraries and I2C.  I would have to look into the code and try it out on my own before confirming anything about this particular code; however, in the meantime you might want to try a tool such as I2cScanner that simply scans the I2C bus for all possible addresses and reports addresses that are "alive".  This (or something similar as I am not sure if you are using Arduino API) might be a good start to just see if the I2C is working and that you have the correct address.