judb, I posted your old entry because your log was exactly the same as bazmk2's log, with the "waiting". If it's adding waiting to the log, then the box itself isn't locked up, maybe just the eprom programming thread? I also noticed that both of your logs had the same entry for the flash chip manufacturer. That chip code isn't on the Wiki page that lists the know chip IDs. Based on sbingners answer to judb's log, I would guess that the chip isn't responding to commands. judb, did you have those same entries in the log when you had a successful patch? I suspect they were different.
Wasn't there a "Phatbox Elite" or something similar? A limited edition box. Maybe, since this appears to be a Phatnoise demo, it's that model, and has different guts?
basmk2, do you have any plugins installed on the box? If so maybe removing them before running the patch might do it.
Also, it seems that people have had problems with disk corruption (I did with both boxes I ran the patch on) during the patch. I think it is mostly problems with bootload.log. If you are using bootload.log, try it without it. For the patch logs, erase the logs folder, run chkdsk to make sure everything is ok, then run a full defrag of the PHTSYS volume. Then create the logs folder manually, and add a blank log file phatpatch.log as the last thing you do, so its FAT entry is at the very end of the used space.
I know these things are really grabbing at straws, but until sbingner or bushing show up, it's something to try, if you want.