I finally called the manufacturer in Switzerland last month to get a replacement or refund, and they helped me resolve the issue and it works fine again. They were apologetic and very helpful. These are the instructions they sent me.
"We are sorry to hear that you are having problems with your Keypad.
"It is always difficult to judge where the problem lies. In the past, we have encountered problems when the Mac was upgraded to OS X 10.7.2 in the sense that the Bluetooth thread was somehow distorted. From your description, it appears that your Mac might have a similar problem in the sense that there have been numerous attempts to pair it. Clearing these threads and pair the Keypad from scratch might be all that is needed.
"So before we exchange the unit, we kindly ask you to try this:
- Remove all entries of "Bluetooth Keypad" in your Bluetooth preferences by selecting them and press "-".
- Turn off your Mac.
- Turn off the Keypad by pressing the on/off button for 3 seconds (the LED will become steady green).
- Start up your Mac and shut it down again.
- Press the on/off button of the Keypad very briefly (only a split second!). The LED should flash briefly. It must not become steady green (steady green meaning it is in the process of turning itself off).
- Start your Mac and open the Bluetooth assistant in the system preferences.
- Press the "+" sign to pair the Keypad. The Mac searches for a new Bluetooth device now.
- Turn the Keypad upside down and press the small black pairing button on the reverse side of the Keypad with a pen.
- The Bluetooth assistant should see the Bluetooth Keypad. It will display an 8-digit code.
- Enter the 8 digits on your Keypad and press the key "enter" on your Keypad.
Note: The numbers will not be high-lighted as it may be with other Bluetooth devices!
- The Keypad should be connected now.
"Please advise if this helped to solve the problem. If not, we will send you a replacement unit along a return label."
Me again here. If this doesn't work and you want a replacement device, their contact info is:
info@cropmark.ch
Phone #: 011-41-56-437-6070
Good luck!
Kristin