When installing new firmware, you need a well-charged battery and the AC adapter must be plugged in. The firmware update code will not proceed otherwise.
These are directions for updating to a "non-signed" version of the XO firmware, which may only be done on an unlocked XO. Do this before booting the XO from an SD card. Make sure that you have first updated the Build to 8.2, as in the previous page.
First download the firmware from http://dev.laptop.org/pub/firmware/q2e36/q2e36.rom:
To download on the XO (into its NAND flash file system), start the Terminal Activity and become root. Then type something like

cd /versions/boot/current/boot/ wget http://dev.laptop.org/pub/firmware/VERSION_NUM/VERSION_NUM.rom
If you want to use a USB or SD drive to store the firmware before installing, replace the first line above with:
cd /media/disk (your USB stick name) mkdir boot cd boot

ok flash n:\boot\q2e36.rom

if the file is on the NAND FLASH in the alternate boot filesystem

ok flash n:\boot-alt\q2e36.rom

if the file is on a USB flash drive

ok flash u:\boot\q2e36.rom
if you are copying the firmware from a Windows machine, 1) Make sure the USB flash drive is formatted for FAT and not FAT32, and 2) don't use a \boot directory. Just
ok flash u:\q2e36.rom

if the file is on an SD card

ok flash sd:\boot\q2e36.rom
(Use the dir command if you need help finding the file.)
This will only work if the XO has a well-charged battery AND is plugged in. "AC not present" means you need to plug it in.
From http://wiki.laptop.org/go/Manual_Firmware_Install. If you have problems with the instructions, check here for more information.