Hi Kim,
I just ran into identical difficulties. I have an interesting, yet somewhat inconclusive observation. Here's a quick rundown of my experience.
Attempted to update my brand new Prime to the latest FW using my Asus laptop. Same result as you from Connectivity kit (104). Had to resort to using Updater.exe in conjunction with the Reset-Symb trick to get into Recovery Mode. Still no joy - Updater.exe attempted to transfer files over to the Prime but in mid stream lost the USB connection and gave up after 4th retry.
I decided to try my luck with my rock stable desktop PC, also running Win7-64bit. After rebooting, reconnecting, reinstalling, retrying until the early morning hours I still had a brick on my hands. My desktop produced the same garbage USB connection as my Asus laptop. I finally decided to give the infamous usbtool.exe a try and quite predictably managed to nuke my bootloader.
Truly a paperweight now.
I ordered another HP Prime and it arrived today. After charging and verifying that I could at least use the connectivity kit to make a backup I was encouraged enough to try a FW upgrade with the new Prime. SAME RESULT! Except this time I didn't use usbtool.exe to at least maintain my bootlaoder.
Having nothing to lose, I dug out my cheapo Lenovo laptop and tried Updater.exe one more time. First of all, there were no long strings of "Error: unrecognized command xx (a1, etc.)" visible on the Prime and the FW update proceeded immediately and quickly. One HP Prime saved from oblivion.
Now, both my Asus laptop and my Acer high-end desktop have no problems at all with USB connectivity and all are USB2 systems. None have USB hubs connected. All three systems are running Win7-64bit with the latest patches. There is something about the HP code USB SW/HW that is incompatible with certain systems, that much is certain. Judging by the horror stories I read on various forums, our experiences are not isolated incidents.