I just upgraded from 3.40 OE to 3.40*, and it works great, but the installation notes never mentioned that I had to switch the kernel mode from 3.40 to 1.50 in the recovery menu(hold R when turning on the PSP) to get it to work.
(I was getting a 80020148 error when trying to run the the updater).
With that said, I didn't have to switch to the 1.50 kernel mode to update from 3.40* to 3.40* v2.
This is just a heads up for anyone that is having the same problem I had.