retrolefty:
Yes, that is a problem, and it's very likely that the sketch is not being loaded correctly after a certain size is reached even though it's less then maximum flash memory size. There is no AVRDUDE error reported after the upload, but obviously the blink program is not running after the upload. It's believed to be a bug in the bootloaders for large (but still legally sized) sketches. For instance when using the Uno's bootloader one can load up a sketch right up to near the flash memory maximum size limit, but with a mega1280 I can't even get close to near max size. Coding Badly is of the opinion that is a bug in older bootloaders and their interaction with AVRDUDE on large code size uploads. So if the 1284P bootloader is just a recompilation based on one of the older mega bootloader programs it may have 'inherited' the same problem. This should be investigated further but I'm afraid I'm not knowledgeable enough in software/bootloaders to be a direct help other then testing.I guess a first step is for someone to try a different method to developing large sketch sizes just to make sure it's not my sketch causing the problem symptom. Anyone up for the challenge?
Lefty
There's a problem related to a bug inside the GNU avr-gcc compiler. If I remember well, the compiler cannot create code that can directly access data in FLASH is it is stored over the 64 kB limit. Latest versions of avr-gcc aren't affected by this bug, the one that is included with the Ardino IDE is.
You can upgrade the Avr toolchain to fix it. I did it for my Linux box.