How to restore an Apple TV first generation if it does not factory restore in recovery mode?

Question

How to restore an Apple TV first generation if it does not factory restore in recovery mode?

The other day, while watching a movie, my Apple TV 1st gen just froze and became unresponsive to any remote control inputs. My intital attempts to just remove power and startup again failed and resulted in repeated crashes and renewed startups. On the discussions here ( Re: Apple TV 1st gen Factory Restore Problems ) I found out how to force restart by holding down the 'menu' key and the ' - ' key simultaneously. This brought me to the Recovery Menu.

Restart from there didn't work, only resulted in coming back to the recovery menu.
Diagnostics showed my Apple TV to be working normally.
Factory Restore immediately brought up a failure message that factory restore was not possible!

I tried this several times but always the same result. My trusted Apple TV first generation had mysteriously turned itself into a brick.

After searching the web and trying all kinds of things, I figured out how to save it. Here's how:

for reference, have a look at this webpage, but keep reading below: http://www.tweaking4all.com/home-theatre/appletv/restore-appletv-os-after-erasin g-disk/
you need a good size USB stick, mine was 4GB
the first method described didn't work for me, is time consuming, and you need an ethernet internet connection
however the second method described (no network needed) worked, but not with the file posted on the website (had wrong size)
download the disk image with the Apple OS from here: http://wiki.openelec.tv/index.php?title=Restoring_the_Apple_OS
I downloaded the Apple OS v3.0.2 file, this proved to be working
If you're on a Mac, download and install the ApplePi-Baker application from here: http://www.tweaking4all.com/hardware/raspberry-pi/macosx-apple-pi-baker/
If you're not on a Mac, follow the instructions in the thread posted in 1.
Using the ApplePi-Baker, or the other methods, restore the disk image to the USB stick; be patient, this may take a while
Unpower your Apple TV, plug in the USB stick, power up your Apple TV
Your Apple TV will now boot up from the USB stick and will install the latest OS on its harddrive
When completed, remove power, remove USB stick, power up and hold down the 'menu' and ' - ' keys simulatenously, this will bring your Apple TV into Recovery mode
Select Factory Restore
Your Apple TV will now factory restore to OS v 3.0.2