Ed - I understand the frustration all too well trust me ;) I completed all of my changes on the command line, so I can guide you through the changes in that manner.
First can you SSH into your device? I ask because you need to check if the add-on you installed in fact installed and dropped the correct files into the proper location. Also you will need to be able to add a udev rule to your device if you are running a Linux based machine (where the actual Flirc device will plug into). The udev rule you need to add is made to auto mount the usb for read and write access and this is just a work around. The udev rule is simply a file that the Linux system looks at while loaded the OS and applies the "rules" each file describes. You can see the actual code from the github repo here: https://github.com/flirc/flirc-xbmc-plugin if you look in the folder marked linux you will see the file that has the generic udev rule you need to create. Its one line of code:
SUBSYSTEM=="usb", ENV{DEVTYPE}=="usb_device", MODE="0666", GROUP="pi"
You put that in a file in the /etc/edev/rules.d directory and then reboot your XMBC device and you should be all set. You may have to reselect the Windows MC contoller, but I only say this becasue this is what is selected for mine. This was my missing piece to get the whole thing up and running. You will need to do this step to get your RaspBMC device to see the Flirc usb. Once you add this on you next reboot you should see it as "connected".
If you installed the add-on by adding it as a source and saw the gui for the Flirc device on reboot then you may already be up and running after adding the udev rule. Once I added the udev rule the gui popped up for me on my RaspBMC and wanted me to prgram a device as well. I happily followed the on screen setup and programed the arrows, a back key and enter key. This is not needed and I realized that when it then asked me to save my configuration. If you have the add-on you do not need to physically program the device, if you can get back to that gui on your XBMC unit on the left menu you can "load a configuration" this is what you want. The add-on has a pre-programmed config file and when I selected the load option I was only presented with one option, once selected I closed the Flirc gui and have been good to go.
Let me know if this helps, or sounds "unclear". I have been writing this as I have been working on some code between tests ;)