Re-image error 2010 to 2011 - Disk Error

[perlgerl]

1. Did the Classmate boot properly using the 2010 software before you started?
2. Are you booting with the 2011 Classmate Restoration key into the USB drive?

Here's my boot choices with a correctly flashed 2011 Classmate and NO USB key inserted:
HDD: PM-SAMSUNG HS030GB
USB:Generic- MultiCard
Nextwork:Realtek Boot Agent

Here's the boot choices with a correctly flashed 2011 Classmate AND a USB key IS mounted:
HDD: PM-SAMSUNG HS030GB
USB:SanDisk Cruzer
USB:Generic- MultiCard
Nextwork:Realtek Boot Agent

I'm guessing the USB key has not been inserted or there is a fault in the USB key connections. Is the behaviour the same with the USB key in either slot?