I have more or less the same kind of troubles.
Tried to flash through the webinterface, both in Linux (Firefox) and in Windows XP (IE, Firefox). Failed, sometimes after 15 seconds or so, sometimes after a longer period.
Tried the latest version of DreamUp (1.2.2.0) through network connection. Powered down the dreambox, pressed the connect button, powered on the dreambox, nothing happens. The software does not recognise the dreambox. I am very sure IP adresses are correct.
Last chance is to find a serial null modem cable and try through the serial port ...
I still have a working system, just bought it two weeks ago, but running on older software I believe.
Where can you find the version that is installed in the box?