I used a new Kingston 8GB Class 10 SD and download from: http://www.mattcardle.co.uk/how-to-inst ... mc-on-usb/
No muss, no fuss, started right up.
Hope this helps.

I don't know what happened, maybe the SD card got corrupted (I'm not a techie), so I reflashed a new card with Raspbmc and started from scratch, restarted and Voila!, all is fine.

My Raspbmc goes through all the setup, updates, then starts an endless loop of Relax, XBMC will restart shortly, but it doesn't… What's wrong??