Managed to fix it! Tried DFTP on my mother's XP computer and it worked! Sent a message to Draytek tech support - who were very helpful - to tell them. Can it be a Windows 7 issue?

Maybe, I haven't tried reflashing the firmware with Win7 much.

Good that the router is working again though

I just had the same experience...!

Flashed with newest firmware to find that only 3 lights on left hand side would light up.

Eventually fixed by going into TFTP mode and using the reset firmware. On my Windows 7 machine I had to make sure that the firewall was off for both Work and Public networks. It then connected to the router fine and re-flashed the box.

Its a happy box again, lets just hope it doesn't happen again!