Many USB flash drives are not compatible with the driver station especially the U3 flash drives.
Have you checked the extension of the file you are updating on the driver station. It should be exactly DSUD_PKG.bin
see here for more details.
http://www.chiefdelphi.com/forums/sh...ad.php?t=72229
Read through the guide carefully. You need to hold down the buttons longer than normal buttons.
http://www.usfirst.org/uploadedFiles...structions.pdf