I went through the program
it is stuck in this loop:
void startProgramming ()
{
byte confirm;
pinMode (RESET, OUTPUT);
pinMode (SCK, OUTPUT);
// we are in sync if we get back programAcknowledge on the third byte
do
{
delay (100);
// ensure SCK low
digitalWrite (SCK, LOW);
// then pulse reset, see page 309 of datasheet
digitalWrite (RESET, HIGH);
delay (1); // pulse for at least 2 clock cycles
digitalWrite (RESET, LOW);
delay (25); // wait at least 20 mS
SPI.transfer (progamEnable);
SPI.transfer (programAcknowledge);
confirm = SPI.transfer (0);
SPI.transfer (0);
} while (confirm != programAcknowledge);
Serial.println (F("Entered programming mode OK."));
} // end of startProgramming
I figured that "confirm" is always "0", so it never will match "programAcknowledge" to leave the loop.
D10 is connected to reset, Both are female jumpers.
When uploading, at least LED 13 of the dead board is blinking as well. that one is not dead.
But is it not performing the reset, I believe.
By the way: I just downloaded "setup_Arduino_ERW_1.0.1h_20121002.exe" with no problems. It says that the upload is done. No error message .... but it does not work either 
regards
Wolfgang