I have reproed the timeout consistently 5 more times monitoring the download progress. It stopped at the same spot all 5 times. I also removed the airport (in bridge mode) and connected directly to the comcast wifi router and experienced the same behavior. I live in in SF so the wireless networks are pretty dense, but the consistent hang spot suggests to me its not the wifi stability. Still may be another local network issue. I will try to isolate that issue by taking the unit to a friends house and see what the behavior is.
If behavior is consistent at friends house I will be logging a "bug" thread as it seems like there is at least one other case of this behavior mentioned here. I have seen other threads talk about download timeouts for updates on server side on the "guinea pig" thread. @hebnern, It would be great to know if you are still tracking any server side issues.
FWIW the temperature controls (configured manually) seems to work great, so i am excited to get wifi working more consistently to take advantage of the full feature set. Consider me a guinea pig, happy to help troubleshoot if i can!