I had the same problem and went through everything here 50 times, searched the net high and low for answers.
Heres my solution.
I found two diagrams for the 1.6 adapter wiring to the LPC Debug port. I followed the official one from DMS. I also found another from somewhere else.
The two differences, were wiring colours for wires 2 and 3. Other than that the diagrams were identical, as my wiring followed the DMS one. The wires on the DMS diagram were Brown was two, and Green was three. On the other diagram, this was swapped, so it was Green was two, and Brown was three, assuming the numbers were wire numbers counting from end to the other both diagrams matched and were identical, however assuming that somebody numbered the wires wrong but the colours were correct I resoldered according to colour from the second web site so I made brown (wire 2) go to the position indicated by 3 on the LPC diagram and green number (wire 3) go to the position indicated by 2 on the LPC diagram (TOP). This worked, I know have my mod working. I tried everything else mentioned on this thread as well.
So try swapping the green and brown wires on the top of the LPC connector, worked for me.
As a note that may be of interest.
The colours of my connector went.
Solder End Converter XBIT
1. Pink ................... ................ 1. Pink
2. Brown ................... ................ 2. Green
3. Green ................... ................ 3. Brown
4. No wire ................... ................ 4. Blue
5. Purple ................... ................ 5. Purple
6. Orange ................... ................ 6. Orange
7. Yellow ................... ................ 7. Yellow
8. Grey ................... ................ 8. Grey
9. No wire ................... ................ 9. White
10. Black ................... ................ 10. Black
11. Red ................... ................ 11. Red
Note my Brown and green wires seemed to be swapped, but if you go by numbers then they are OK!
You work it out!