malc-c:
ignore the ISP connections, I've just used the serial connection shownand yes I've tried DTR connected via the 0.1uf capacitor, and without - It doesn't get that far to reset the chip
If this is board, it appears to provides 3.3V be default, not 5V,
You definitely need to have the DTR wired via 0.1uF cap to do the proper reset. You also need to
have the Rx,Tx pins swapped as shown in your schematic, if using a regular FTDI cable or FTDI Friend.
For the sparkfun board, you just have to be certain the signals flow in the correct directions.
I always use 1K resistors in Rx,Tx lines in case of mistaken cross-wiring.