Did you use a wrong file? Some firmware zips have a big file in the main folder (use this one) and a patches/ folder with small files, which you shouldn't use as they brick your device.
Unfortunately there is no way to recover either. The Story HD executes a script in its main memory on boot up, which doesn't help you any when the device already hangs during boot up, and if you didn't put a script in there beforehand.
You also have to be careful with hardware versions I guess, there is Wifi and there is Basic without Wifi. On the other hand the hardware of those is completely identical (save for the missing wifi component) so it's actually possible that the Basic firmware would run on a Wifi device (although I'd rather not try since doing so might brick it).
There are at least the four basic JTAG test points on the board so it might be possible to gain access to the devices flash storage using debug hardware, however I didn't have a chance to try this yet either.
Warranty (getting a replacement at the store where the device was bought) is probably the best option...
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