NOTE: some users have reported getting stuck in an unbootable loop(noting error messages about the flash "upgrade rom code error") after this step. simply flash any rom and you should get out of this cycle. below are linkes to the dumped stock roms, I grabbed the links straight out of imcokeman's thread so make sure you give him thanks if you use them.
link to his thread
http://forum.ppcgeeks.com/showthread.php?t=42741
if this note helps you please sent hotspace some thanks for figuring this out
I dont know if this has happened to anyone but it happened to me and I couldnt load a new ROM becauce activesync would not connect to my phone.
HOW TO FIX
1. Take out memory card
2. Press the d-pad to get back to the tri color screen
3. unplug the USB,wait 5 secs and plug back in.
4. As soon as the Activesync arrows start spinning go aheah and start the flash. (You have to flash from the computer, get a ROM and load it up and Start flashing. It will recognize your phone)
I dont know how many people this happend to but it happened to me but now my phone is fine.!!!!