I am having a similar issue. Excited to receive new flirc yesterday. Installed drivers, and setup Harmony Ultimate (flirc/xbmc) and Can click around for a few button presses and then is gets "stuck" in a repeat cycle. Not "endless" but is useless.
Flirc in front USB port of Zotac zbox... Not inside cabinet. Harmony Ultime working well with all other appliance just here. Any news on the subject?