Hi, you are doing it right, the problem seems to be that the xml data that PMM is attempting to download is no longer available on the Phatnoise site.
I was just attempting to update myself and had the exact same problem as you, so I sniffed the traffic and found that PMM was receiving an error to it's request to get the data. Unfortunately for you your firmware is fairly old so you definitely want an update.
I just submitted a letter through PhatNoise's problem reporting tool. I hope they respond with a fix. There are some supposed ways to manually update your Firmware, but it's not supported and I have not tried it myself. I only learned a little about it via a site for people who want to use PhatBox with Linux instead of Windows.
Lets keep our fingers crossed.