Almost. You will need to comment-out (or remove) this part...
// Check if the WDT was used to reset, in which case we dont bootload and skip straight to the code. woot.
if (! (ch & _BV(EXTRF))) // if its a not an external reset...
app_start(); // skip bootloader
That bit of code skips the bootloader and jumps straight to the application in the event of a watchdog reset. In your case, you want the bootloader to run.