Have you tried the reset for firmware loads by removing the battery, then plugging in the USB cable to your PC and N900, yellow light comes on, then put the battery back in? I had to do this several times...

My upgrade hassle to a solution is in this post. Only other thing to add is I would have to power down the N900 after each reboot. It stayed on technically, even thought the screen was blank and it appeared as good as dead. Holding the power button for ~2-3 seconds would illuminate the white status light and the brightness would slowly fade. The black blank screen would change to a different shade of black (easy to miss) and I'd know it was then really "off". This took <10-15 seconds total for the power off. Only then could I hold down the "u" keyboard key and plug it into the USB port to start the flasher.