Alright, up on 1.05 now... Looks like some thing is broken with USB updating in 1.05.
It does a quick 30 sec flash from 1.03 to 1.05, then reboots and does about a 5min update from 1.03 to 1.05.
My guess is that in going from 1.01 to 1.05, the USB update starts, it reboots, then can't read the firmware on usb anymore. If you use a blank sd card for the whole operation, you should be fine.