Nick, I would suggest skipping the suggestion in the manual directing you to hook your PC to the cRIO through the Driver Station. If you have already updatedup your driver station, It's new IP address will be 10.XX.YY.5, or in your case 10.0.8.5, and the cRIo is by default 10.0.0.2. Since they are on a different subnet, then they cannot communicate with eachother.
Assuming you have already updated your DS and set you team # into it, I suggest taking the orange crossover cable from the kit that is designated for the camera, connecting it from the PC to the cRIo port 1. For reference, you can always tell its a crossover if you hold the two connectors of the cable side-by-side and they ahve a different pinout/color arrangement.
Then set your IP address on the PC to 10.0.0.6. Power on the cRio and do the update process.
If you still have troubles, go to Start->Run and type cmd. This should bring up your prompt terminal. Two commands to remember are ipconfig and ping. If you type
ipconfig, and there are at least two devices on the connection (in this case a cRio and a PC) this will show you what your ip and subnet are configured as. If you have multiple NICs or a wireless adapter, make sure you look for the right one. If you type
ping <address> , where address is the IP address you want to see is communicating on your network, you should see a test of that address which at the end should tell you if there was a reply from the device in question.
In your case type
ping 10.0.0.2. If the cRIO is there and has an IP as expected, you should see four successful message packets sent and replied to. If not, then you might have bigger troubles on your hands, or someone updated your cRIO and didn't tell you.
As a last, and I mean last, resort, you can consult page 15 in the crio-frc_Operating_Instructions.pdf available on the NI.com/first site at:
http://decibel.ni.com/content/docs/DOC-2632
This will show you how to set the IP to 0.0.0.0. Then setting your PC to 0.0.0.X, where X is not zero with a subnet of 255.0.0.0, should allow you to update the cRio.
When you have successfully updated the cRio, make sure you set you PCs IP address back to 10.0.8.6 and test out the entire system as outlined in the manual on the network setup. I suggest a qiuck ping test to each of the devices in the network for confirmation.
Good luck...