So I went to the local temp folder and I copied the downloaded ROM from Cingular that the online update utility had downloaded previously and I used those files with the offline updater. It completed successfully, but the phone wouldn't save the settings and was experiencing several glitches, etc. so I did another full reset (press power button while holding action key (blue button)) and after that it's been running smoothly.
I have noticed that the memory management is definitely much better. I use xBar 2 and I had internet explorer, a game, mobipocket reader and windows media player running at the same time, semething that I've never been able to do with the previous old ROM. That and the phone does feel faster, and ActiveSync now connects immediately, instead of the hit and miss process that it was before.
I risked screwing up my phone, but now that it's over I'm really happy with it.
Now I just wish Cingular would update it to WM 5.0 but that doesn't seem like it's going to happen...