Given I didn't want to wait for a Whitcoulls update I went and downloaded the new Kobodesktop from kobobooks.com and upgraded my gen1 kobo to the new firmware.
Everything seems to be fine apart from....
1) VERY weird page turn semantics on the Kobo format book I'm reading, i.e. page turns from 5->6->7->8->5->6->4. Or something along those lines, it looks more like the the Kobo is reading the book database wrong as I also had "CHAPTER 46" in regular fonts in the middle of the screen
2) A LOT of dowloaded ePubs ( generated via Calibre ) are unable to be opened. Other epubs seem to open. When I try to open the Kobo just does't respond, it doesn't even LOOK like its trying to open ( and no "your device is not registered" messages for DRMd ePubs either ).
3) I see the blue light flashing when pages turn, I don't remember the kobo doing this before so I'm not sure if this is an indication of a problem, or just additional processing?