3 days later.....FINALLY GOT IT WORKING (upgrade firmware to 1.27)
I want to thank everyone that posted to this forum as I wouldnt have been able to do it without reading these posts. Below is the hardware I used and how I was finally able to update.
Headunit: Alpine CDE-HD137BT (v1.14.00)
Location: Chicago, IL
Device used: Macbook Pro
Device to play audio: iPhone 5 (iOS 7.0.5)
I followed the instructions from alpine, meaning remove all paired devices, and checking the settings listed in guide. I then tried to use my iphone and ipad to transfer the file using the jailbroken app called iFile as it supports bluetooth file transfer. Of course that didnt work.
Next day I borrowed my friends Microsoft Surface Pro with windows 8.1 and also couldnt transfer the file to the head unit.
Next day I reformatted my PC to Windows version 8.1 and installed a new bluetooth adapter, still no luck, I wasnt even able to find the 'update' folder on the head unit. The computer would only think the head unit was for audio, in the instructions it says to go to services and uncheck the Handsfree service but leave all others checked. When I went to do that step, there were only 3 services listed instead of the 6 or so that are pictured in the Alpine guide.
Next day I borrowed a friends Macbook pro (2012) as I heard some people here had some luck with that. I did as the people on this forum said to do....meaning try to connect, disconnect, reconnect, turn off the head unit, and so on and so on. I felt I made some progress when on the macbook pro I could actually SEE the update and record folders however when I went to drag the firmware file from the laptop to the headunit I kept getting the error message (on the MBP) 'you do not have permission to write files'. I kept at it for a good 20 minutes trying to transfer the file over and I also noticed that when you say update firmware YES then the screen goes to "waiting..." as soon as you try to connect to the headunit after that, it automatically goes to the screen that says "updating firmware do no touch buttons".
In the 20 minutes with the macbook pro, I never saw the file actually get transferred to the update folder and I never saw the head unit read "UPDATE COMPLETE". However, right after I had given up, I went to view the current firmware version and it magicaly said v1.27!! So somehow some way, the file actually did transfer even though I always got the "you dont have permission" from the macbook and never got further than the "updating firmware do not touch".
Now the update is working and I'm happy because I can now see the song names on the screen.
Thanks agin