We had three WRT54GL routers running v1.0.  In two cases, the router owner connected the router to the Internet and used the built-in Download Firmware option.  In the third case, I chose not to connect the router to the internet, and instead downloaded the file to a laptop, and then manually uploaded that file to the router.  In all three cases, all appeared to go well and the routers indicated they had successfully been updated to v3.1.0. 

But... none of the routers could see each other afterwards.  Closer examination indicated that in the case of the first two routers, even though the router indicated the current version was 3.1.0, if you scrolled to the end of the SSID field, you found that "-v1" was appended to the SSID.  Even after correcting that, the routers still couldn't see each other.  There were no other obvious problems.  None-the-less, that SSID issue made us suspect the v3.1.0 software update hadn't replaced all the v1.0 code properly.

So... we manually uploaded the file to the first two routers to over write the firmware that had been installed using the integral download feature.  After that... all three routers saw each other fine.

If this had happened just once, I'd be inclined to write it off as a fluke.  But in this case it involved two routers experiencing the same problem.  And involving the same model router. This version has been out a little while now, so I'd have thought if there is a bug, it would have been caught by now.  But I don't know how frequently people use the download feature or how often they do that in combination with an update from v1.0 rather than an intermediary version.  In any event, thought I'd report our experience so you can consider whether this is an issue that needs to get chased down.

Dave