Sorry to hear that problems.
First of all it would be nice to update the firmware this may solve the issue with the USB drive as well.
To do this please try to use shortest as possible USB cable, and try to use another USB port on your PC. Please remove any other USB devices from your PC, then reboot. Start the driver installer, connect the LP-16 to the PC then turn it on when the driver installer ask you to connect and disconnect the LP-16.
When you successfully installed the driver do a similar method with the firmware installer as well.
If the firmware up to date please format your USB drive with LP-16, then check the problem still exist or not.