imho that is just some app-manager problem ..

*warning* you will have to use the x-terminal or ssh .. if that scares you / puts you off / ... ask someone else to do it or use the nokia flashing tool or delete _all_ the apps you installed and try again *warning*

but just a warning make sure that you have enough space on your root filesystem (use conky to show you or open a terminal and type 'df -h /' ) - I had ~ 38MB free and it worked fine - theoretically less should be ok but i wouldn't try it if i had less than the 13MB or sth the update says you need

also i won'T take responsibility if you brick your device, loose your data (imho if you don't make a backup and copy your photos and stuff before an update like that it is your fault anyway ...) this is just a comment to point out how I did it ..

what i did to install the update:
- disable all the extra repositories to avoid any updates you might not want just now
- close app manager
- open terminal (or connect over ssh)
- become root user (htere is a package for that which makes it happen if u just type 'root') -- if you connected via ssh this is most likely not needed
- type 'apt-get upgrade'
- look at the list if you feel like it - same as it shows in app manager - and then type 'y' to continue (it'll download and install the apps)
- wait for it to be done (shell prompt appears again)
- type exit (2 times) or close shell
-- at this point it stills shows the old version if you go to settings - product info
- shut down your phone and then start it up again [the first thing i saw there really was a notification that i got new mail ... Viagra advert ]
- go ot settings - product info and stare at the new version and be happy
- enable extras repositories again if you want them - which is most likely - in the app manager

again .. i do not take any responsibility if you break anything :-P but should there be an issue i might try to help if asked nicely