I feel like somewhat of a broken record following up to myself. :)
As I mentioned, I opened the unit. As I didn't want to remove the warranty stickers (man those things are THIN and flaky) I just did a visual inspection and pressed a bit on the cable to make sure it was mating against the drive. I moved the drive tray a bit to feel the suspension.
Plugged the unit in and.... IT WORKED.
Unplugged it, depressed the drive tray a bit and then powered up again. Stopped working. While it was in this state, I pulled up a bit on the drive tray and could hear the disc spin up. I think the cable is not mating 100% at the motherboard or it may be somewhat faulty.
After getting it to work again, I closed the unit and all has been fine for a few hours. I upgraded the software to 1.03 from 1.02a and loaded up 50 random songs I had lying around here (none of the ones I've ripped myself, so most were missing tags, etc..) Anyway, I took the time and connected the unit up to a TV because I don't have a preamp around right now. :) Sounded great. The navigation was somewhat limited because I didn't have any structure yet (I just dumped everything into a single test playlist).
I'll stick with 1.03 until the next beta of 2.0 I suppose. I'll be going through the logs again to see what usability updates have been made. The unit is great, but I still have some wishes for things that are missing in 1.03's track selection/display and visualization interface.
OK, time to buy another drive. Maybe time for another thread. Ah what the hell: Can anyone suggest some good online locations to purchase 2.5" drives? With decent price, fair shipping (that hopefully will serve Canada) and good customer satisfaction (no hassle doa/warranty returns, etc..) Right now it looks like 30GB is the sweet spot - of course if anyone has seen exceptions to this, let me know. :)