Sorry for the late reply. I was away when you replied, then my brother was away when I wanted to test the router at his place. I'm up and running now thanks to your help.
I'd already checked I had a type A router, and had downgraded the firmware, but the problems I had included:
writing to the physical drive instead of the disk from DiskImage
possibly two bad USB sticks, both very old (I bought a new one)
assuming that I'd be able to read the image in Windows (it worked in Ubuntu)
At some point, I had to start using 192.168.1.254/usb2 instead of usb1. I have no idea why.
I also had a problem when I was telneting to the router that the smb.conf somehow kept getting overwritten after maybe a minute or two, so that I couldn't get a connection. I tried and failed a few times to connect to the router with kitty, and changing directories didn't help, but somehow I did finally get a telnet connection.
Anyway, it's all working now, thanks again!