I got my reader working now!
Here is what I did (before knowing that rupor updated his AMR packages):
1. Unzip the restore set for 1.0.05 to a folder.
2. Copy the OS firmware folder from the restore set to the root of the sd card.
3. Boot into recovery mode by holding the home+menu key while powering on.
4. Wait for the update to finish with the update is completed message.
5. Reset device to reboot.
That's all. I think my previous problem was that there are some 1.0.05 files on the reader. The sd restore images are unable or refuse to overwrite the newer files causing a mix of new and old firmware files to coexist in the reader.
Thanks all for the Help.
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