Wow that's definitely unusual! It should go:
Connect USB device: "Device not supported" along with USB logo in top corner should appear instantly.
Wait a few seconds, then "No filesystem found/available" message should appear. If you check your wifi connection it should now automatically be connected to "WIRED".
Launch browser/app/etc and watch it work.

If you run from xterm you should probably will see the "auto_connect" error come up, but that's fine it doesn't affect anything (it's a leftover from the Chinook days that I just didn't pull out of the script yet). The DHCP should come back and tell you that it's gotten a lease after a few tries and you should be all set. One thing to keep in mind with USB stuff, especially networking, is that it's very power sensitive. That is, the tablet in it's power management wisdom will actually drop the current available to USB devices as the battery drains, which means if you're on like half battery power the network adapter might light up for a few seconds and then drop out. Sounds like what Tex was experiencing with the "connect/disconnect" multiple times by itself.
Beyond that, I'm not sure, sounds like quite a strange series of events. I've only had prolonged success with by USB100M (other adapters have done very odd things indeed), but I know others have said that things were working for them... In any case I'll double check the scripts and make sure I didn't mix anything up in the last update...

Thanks,
-Rob