My friend, I wish I knew. I know it does not help but I got SSH enabled which means that I can use Telnet and SFTP on my NAS to take out and put in files onto the NAS. Useful to get at the back end to fix a broken Dashboard UI.
WD's advise will be to send it back to them. They also state that hundreds of thousands of MBL's take the update without problems.
I got to admit that since the firmware was upgraded on mine, I've not rebooted it or shut it down and I don't think I wish to until the next firmware update becomes available. From what I've read I wionder if I reboot my MBL, will the Dashboard UI die on mine? Right at the moment my MBL is operating fine and dandy. The Dashboard UI is operating quite swiftly. Even with Twonky enabled the device goes to sleep for reasonable lengths of time.
Short of cracking open the case, attaching the drive to a computer to gain access to files to try and fix the problem or recover the files of the drive.... Send the thing back to Western Digital for a swap?
What if you take your MBL to a friend's house and try accessing it there? Just to eliminate an issue with your computers and network.
If anyone else reading this has got a better solution, would be good to hear.
From what I've also seen on here, the MBL's have been disabled or bricked where the owners are technically clueless of messing around with Linux, let alone knowing what SSH, PuTTY and SFTP is all about.
If this is really the case then there is something seriously wrong.