I have had success recovering from a boot loop by manually following the recovery script on a Kobo H2O. I will have to go into my H2O again to document it properly, but will outline the process here. This process will not work if the boot loader or partition map is damaged, but it should work if the files on the system partition are damaged. You will need a computer with an SD card reader and Linux (a LiveCD/LiveUSB distribution is okay). I'm being deliberately ambiguous here since you should only follow these instructions if you have sufficient understanding of what I'm talking about. I will provide more specific instructions when I have a chance to go back into my Kobo and document everything down to the commands used for both the recovery process and verification that the steps will work (e.g. ensuring that you are referencing the correct partitions).

Remove the SD card from your H2O and insert it into your computer.

Make a full backup of the SD card, in case anything goes wrong.

Mount the partitions and figure out which devices correspond to the recovery, system, and data partitions. These will look like /dev/sdLN or /dev/mmcblkNpN. Unmount the system and data partitions, but leave the recovery partition mounted.

Look for the /etc/init.d/rcS file on the recovery partition. This will outline the steps that you need to follow in order to restore the system and data partitions to its factory state. Do NOT copy and paste the commands. You will need to adjust the device names in order to reflect the device names on your computer. These will probably be different from the device names on the H2O. The general idea is that you will reformat the system and data partitions, remount those partitions, then extract the recovery archives to those partitions.

Reinsert the SD card into your H2O, then reassemble. For good measure, perform a factory reset from the software since the recovery script performs some cleanup tasks that you may have ignored earlier.