Stalker with UartSB v2.2

I don’t know whether this is the right forum for newbie questions. If not, I apologize. I have a new Stalker V328 with UartSB v2.2 which I just received today. I’ve installed avrdude and the driver, and am trying to run Blink on WinXP SP3. Getting the following message from avrdude:

Binary sketch size: 1010 bytes (of a 30720 byte maximum)
avrdude: stk500_getsync(): not in sync: resp=0x30
avrdude: stk500_disable(): protocol error, expect=0x14, resp=0x51

I get red flashing LEDs on the Stalker (D5) and on the UartSB (TX). The TX LED turns off after a minute or two.

I’ve set the Stalker up as Arduino Duemilanove or Nano with ATmega328. I’m powering the Stalker with a new 9V battery and a CR2032.

Could I please get some guidance? I have no previous experience with ATMega. How are the two switches on the UartSB supposed to be set?