I disagree - a full factory reset would be useful (if only to keep the warranty).
I wouldn't be surprised that the factory reset simply wasn't fully implemented - the device was obviously rushed through, to pre-date Kindle Fire.
For now, having a bit-to-bit identical copy of the internal SD card appears to be the best way to recover a bricked unit. I'll buy today an 8GB micro-SD card (hopefully, they all come in bit-identical sizes!), and will do "dd" on the whole card.
I've tried all kinds of combinations of different buttons, including power and volume up, and didn't get any "update is completed" messages, and my data appeared to be all intact.