I successfully updated one of my DCO's BB Curve 8520 from version 4.6.1.174 to version 5.0.0.681. It took me 3 software downloads with the last one being successful and several Google links. It's a good thing the internet connection managed to achieved a 60+ kbps and I thought would take until 5pm to download a 116mb file.

After following the tip of deleting the vendor file, in which case, I just renamed it to vendor2. Then restarting the laptop to refresh the system and then plugging the powered-off Berry and removing the battery. I, then, inserted the battery while simultaneously opening the apploader file. A PIN: UNKNOWN was detected and the way it should be. It took a few minutes and then just clicking buttons and choosing apps to be installed, the upgrade was complete.

Thanks to my researching skills, heehaw, I have been successful after several attempts. Indeed, failing many times only means finding the number of times on how not to do it until you found the right one.

To summarize on how I did it, the following is the suggested answer on how to upgrade BlackBerry 8520 to OS 5.
•    Backup phone.
•    Download OS5 from here
•    Installed the file.
•    Renamed vendor.xml to vendor2.xml.
•    I connected the Berry which is off at that time.
•    I removed the battery.
•    I open the apploader file which is in C:/Program Files/Common Files/Research In Motion/AppLoader
•    I inserted the battery and press the NEXT button on the window after double-clicking the apploader file.
•    I waited for PIN:UNKNOWN to appear and after a few minutes, it detected the Berry.
•    I selected the apps I wanted to install.
•    After a few clicks, the Berry is already upgraded.