I'm having the same problem on my 1.33Ghz 15" Powerbook. The updater cycles through searching for a device to update, preparing to update device, and eventually goes back to idle. When I go to quit the updater, it tells me that the firmware wasn't upgraded and am I sure I want to quit. At this point, I have to reboot in order for bluetooth to work again, as it is unavailable.
I've even tried powering down my Apple bluetooth keyboard before running the updater, and still no luck.
Help!