FoxFi: "Your carrier has blocked WiFi mode in the latest phone update"

OK, I sucked it up and will accept I have to use FoxFi in USB mode. My work computer is Windows XP. I tried hooking it up and it said I had to install the pdanet software. However, I also noticed that the computer did not even recognize the phone as an additional drive. I tried working with FoxFi app and things but then had to leave.

Then later, I started by first installing the Motorola Device Installer. So now my computer recognized my phone. Then I clicked on the Activate USB on FoxFi and it says "Fail to decode 676"?

Any ideas before I reboot my phone and my computer?

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FoxFi: "Your carrier has blocked WiFi mode in the latest phone update"