I am getting exactly the same results.
Same creator and MAC OS version.

I found a solution. Download the disk image for Apple TV 2.4 here: 
http://mesu.apple.com/data/OS/061-6242.20090624.Aq20P/2Z694-5660-029.dmg

In the ATV-USB Creator click CHOOSE A DMG and attach the downloaded disk image.

Then the creator runs normally, and installs boxee along with the Apple TV OS.

You guys are genius's

I was having the same problem.  I downloaded the image and am now getting this 
message:

Creating USB Flash Disk...
  umount_disk settling delay (10 seconds)
  partition the target disk
  umount_disk settling delay (10 seconds)
  install recovery onto target disk
Unable to mount image: hdiutil: attach failed - Resource busy
  install_recovery failed
Failed! (0:01:16)

Any Ideas?

I downloaded the 2.4 firmware DMG, per comment two above, and it worked great.
I did get that "Resource busy" thing a few times, and I think I simply quit the
atvusb creator, rebooted my Mac, ran it again, and it worked.  If it wasn't 
exactly
that sequence, it was something not much more complicated then that.  I may 
have had
to re-format again.

Ok, so i can't get this to work in Windows.  I get the same error.  Any 
suggestions?  

Works in Windows.  Check out the batchfile update here 
(http://code.google.com/p/atvusb-creator/issues/detail?id=333).  Also, I was 
getting a 
404 issue with the batchfiles when I was running them from too deep a directory 
path.  
I copied the Windows atvwin folder to directly under c:\ and ran the new 
batchfile from 
above and it worked like a charm.

[deleted comment]

when I "download the disk image" of 2.4, it loads as OS boot and there is 
noting that can be opened as a dmg.  
still get the error 404 message.

"when I "download the disk image" of 2.4, it loads as OS boot and there is 
noting that can be opened as a dmg.  
still get the error 404 message." 

So OSX auto mounts the dmg, unmount it. There IS a dmg present or OSX would not 
be able to mount it. Check 
your "downloads" folder.

I have no idea what I'm doing wrong, but I still can't get this thing to work.  
I never should have updated to 
Apple TV 2.4.  My Boxee had been working fine until then...

I downloaded the disk image disk image for Apple TV 2.4 at: 
http://mesu.apple.com/data/OS/061-6242.20090624.Aq20P/2Z694-5660-029.dmg

However, when I attempt to choose a DMG, I am not sure what to do next.   I 
don't see any way possible to 
simply "attach" the DMG file because (a) there are several of them in the 
download (Applications, Library, 
System, SeedScratch, etc), and (b) a window opens prompting me to select a 
file, but I;m not sure which open 
to select, and in any event all of the possible file selections are grayed out 
and not active so I can't "open" or 
attach any of them.

I'm surprised that no one has mentioned this issue.   Can someone please give 
me idiot-proof, step-by-step 
instructions on what to do next?  Thanks!

monica & independencefund....  I **think** this might help.

When I downloaded
http://mesu.apple.com/data/OS/061-6242.20090624.Aq20P/2Z694-5660-029.dmg, I
downloaded it to my DESKTOP.   That was the only place I could be sure it 
wouldn't
get me confused.   

As soon as it was done downloading, an OS Boot window opened revealing lots of 
grayed
out items and random folders.  Damn.  What the hell is that.  I don't know. 

So I just said "okay, I'm going to pretend that didn't happen."  Closed that 
window.
 Put out of my mind.

I went back to the ATVUSB-creator and hit the blue "choose DMG" button and just
selected the disk image icon on my desktop.  And it's doing something now!  
woo-hoo!
granted, I'm a little nervous because it's taking a long time.....

oh dang, I hope it's not stuck.  It's "copying files" and has been there a 
while...

Issue 359 has been merged into this issue.

Issue 356 has been merged into this issue.

Issue 352 has been merged into this issue.

Issue 348 has been merged into this issue.

Issue 343 has been merged into this issue.

Issue 351 has been merged into this issue.

Issue 357 has been merged into this issue.

Issue 364 has been merged into this issue.

Issue 365 has been merged into this issue.

Issue 372 has been merged into this issue.

Issue 374 has been merged into this issue.

I have tried rebooting OSX a couple times to resolve.  I've done this install at
least 3-4 time before and have never encountered this error.  Please help with a
solution, as I don't see any explanation of why it is happening.

Downloading 2Z694-5573-24.dmg...
Download failed: HTTP Error 404: Not Found
You can try again to resume your download

JB

@ chi2cecile, this has been covered again and again. Manually download the dmg.

I started this question. I have solved my problem and been successful setting 
up both my Apple TV's. The break 
thru for me was when I discovered that the DMG that I need to select was 
automatically being downloaded to my 
Download File. So when I discovered that, I simply follwed the instructions to 
run ATV USB Creator and opened 
the DMG and went to my download file and matched the DMG file there to the 
/dev/disk2/ shown in ATV USB 
Creator. In the end now I understand how simple this was. But from all these 
responses it appears I'm not alone 
with have the problem initally.

2546687900            Downloading 2z694-5573.dmg...Download failed. HTPP Error 
404 Not Found You can try 
again  to resume your download htis are the thing pp up on my  coputer by the 
way im using mac 10.5.8 version 
my apple is 2.4 version.ill try many times it happened the same way  can u help 
us what im gonna do thanks

This is the last time that I'm going the mention the solution since users can't 
seem to understand how to uses 
the issues page to search. 

Manually download the dmg and select it in atvusb-creator. Do NOT try to auto 
download as the URL reference 
atvusb-creator uses for autodownload is gone forever from the net.

Issue 376 has been merged into this issue.

Thanks for the clarification in comment 26! works fine now.

Issue 386 has been merged into this issue.

thank you or the link! I created the patchstick before but my gf erased it... 
then i figured this was the problem, 
thanks guys!

I've tried it this way and I get the following error.

Error creating partition map: The chosen size is not valid for the chosen 
filesystem (-9962)

512 mb usb drive. 

@aaron.bramley
your stick is probably too small. Had the same issue here. Worked with 1GB 
stick.

Any word on whether or not this works with the appletv 3 update?

im abit of a n00b at this any guideline help would be much appreciated

Hi, Ive managed to get the correct .dmg I think for 3.0.1, its 
2Z694-6004-003.dmg that Ive downloaded. 

Im running 3.0.1 on my Mac AppleTV and using atvusb-creator1.0.b10 and running 
as show with the custom 
firmware 2Z694-6004-003.dmg i downloaded from another site. But its not booting 
when I plug it in my ATV 
and boot??

Any help will be much appreciated

I'm having the same problem on OSX 10.6.2 SL.

The very first post would resolve this except that apple has removed it 
(http://mesu.apple.com/data/OS/061-6242.20090624.Aq20P/2Z694-5660-029.dmg)

I was able to create the patchstick finally.  
-First I was not getting any message since it was looking for the .dmg.I 
downloaded 2z694-5660-029.dmg   
-first time running it got stuck halfway and ran forever.  I ejected it.
-I then got the error message after 0:55 seconds telling me it failed
-ran disk utility, first ran disk utility-first aid-erase, then ran erase-mac 
os (extended)
-reran atvusb creator 1.4.0.b10 and it worked!

Haven't plugged it into the ATV yet but happy to get this far.  Hopefully I get 
it to work with ATV 3.0.1 (might 
need to telnet to the box and run some scripts)

2Z694-5660-029.dmg selected
Extracting boot.efi ...
Creating USB Flash Disk...
  umount_disk settling delay (10 seconds)
  partition the target disk
  umount_disk settling delay (10 seconds)
  install recovery onto target disk
  copy files to target disk
  remove recovery hfsplus GUID
  umount_disk settling delay (10 seconds)
  change recovery to real GUID
  umount_disk settling delay (10 seconds)
  install patchstick onto target disk
  copy files to target disk
Complete! (0:01:41)

I had the same issue initially, and this is what I did to resolve it:

- Used a 2GB USB stick
- using Disk Utility I erased the USB stick selecting the file format Mac OS 
Extended 
(journaled)
- downloaded the Apple TV 3.0.1 firmware from: 
http://mesu.apple.com/data/OS/061-7491.20091107.TVA31/2Z694-6004-
003.dmg (you can get a list of the firmwares from here: 
http://www.iclarified.com/entry/comments.php?enid=970#commentsanchor)
- Opened atvusb creator 1.4.0.b10
- Clicked 'Choose a DMG' and selected the freshly downloaded firmware
- Clicked 'Create Using ->' (make sure you have selected the USB stick)
- Once done:
- Unplugged the Apple TV. Inserted the patchstick into its USB port. Plugged it 
back 
in
- Once the patching is complete (a lot of text on the TV, the last output will 
be 
"Hostname: appletv.local .... "), do this:
- Unplug your AppleTV. Disconnect the patchstick. Plug the AppleTV back in.

Done

Arnstein, you meant to say you used atvusb-creator-1.0.b10 correct?

Yes, he did.

Everything works fine except when I restart the AppleTV after I remove the 
patchstick I only get a third party software tab added to the menu. No SBMC tab?

See issue #411, you mean XBMC tab. Both frappliances need updating

Hi, 

It works here after following Comment 39 by Arnstein. However I get a message 
saying that I cannot start Boxee 
from this location... 

Anyone know how to fix this?

Download it from Downloads section of XBMCLauncher

Hi guys,

Really helpful forum, but still, my patchstick is not working. I manually 
downloaded the image and used the atv 
creator to create my patchstick (I'm on macOSX) but when I plug it to my 
AppleTV and start it, nothing happens (i 
don't get to see the tux). I've tried several pendrives and it's the same... 
Maybe I'm not formatting the pendrive 
properly? can anyone tell me how to do so?

Ty

was able to create the patchstick finally.  
-First I was not getting any message since it was looking for the .dmg.I 
downloaded 2z694-5660-029.dmg   
-first time running it got stuck halfway and ran forever.  I ejected it.
-I then got the error message after 0:55 seconds telling me it failed
-ran disk utility, first ran disk utility-first aid-erase, then ran erase-mac 
os (extended)
-reran atvusb creator 1.4.0.b10 and it worked!
http://download-mobile-software.blogspot.com/p/unlock-jailbreak-iphone.html
Haven't plugged it into the ATV yet but happy to get this far.  Hopefully I get 
it to work with ATV 3.0.1 (might 
need to telnet to the box and run some scripts)
http://download-mobile-software.blogspot.com/