CodingBadly,
Yes, that code is producing the aforementioned sequence.
westfw,
You know I went back to the original optiboot code I have and couldn't find that WDTCSR coding, I think I lifted from another bootloader. I will take a look into that line.
No, I never turn on the watchdog. I would just expect the main loop to keep looping once it completes. The first 8-16 loops execute immediately. However, after that it executes every +5 seconds. Which has got me confused. Maybe it is set in the fuses?
Thanks for your replies!
-ren