Thanks for posting this - very helpful read, as I prepare to drive up and rescue my damsel in distress suffering the same problem in her garage at work.
I wanted to update this thread to note the similarities in your situation and ours right now: original owner using 2012 as daily driver; years of reset-free driving; the "flashing ready" indication; and several rounds of soft resetting didn't help. AND we have the 535 update.
If 535 seems to be the cause of these issues, and KA has indicated 535 will be the LAST update, then it seems KA has left us with a faulty product, which should add to the pressure for them to work with PowerSource on a longer-term solution.
Also a huge shout out of thanks to Harleyguy who diagnosed this by phone, sent pictures and basically saved us once again.
Karma #328: Shadow on Monsoon Tri-tone