First of all i am not a battery expert, so i can’t tell you if battery was actually damaged by the diode or it is only the firmware that do not recognise the battery charge correctly. Test your battery under load and you will get an answer.
Lithium batteries are tricky to charge, and obviously a diode it is not a good charger. If you take a look at the LTC4054 datasheet, when it begins battery charge, the current is limited. With a diode such as S34 the only limitation here is provided by the USB port (which in theory its not allowed to surge more than 500mA without an external adaptor). After current limiting there is a top voltage limit arround 4.2V. That would not be the case in the diode circuit.
Disclaimer: i own a NANO and i think is a good engineered device.