Looks like they're not quite finished with the upgrade.....
I tried this morning too, with the same problem. I went into the v2.0 FAQ and somewhere in there was a link to "sign up for a v2.0 account" I clicked on that just for the hell of it and it said that the v2.0 servers were down for scheduled maintenance. I think what's happening is that when you connect, you're still on the old server and when you start the upgrade applet, it's trying to redirect us to a server that's not online at the moment. All we can do is wait it out. ....
Let's all keep trying throughout the morning and when someone gets it to work, let the others know via this thread.
-nandroloner