I'm using a supported SanDisk 256MB card on my Eclipse, which is running 3.1, and the Eclipse seems to accept it just fine.
When trying to upgrade to 3.5 however the Eclipse doesn't respond to the 1 and 3 keys. I did load the 1.2 bootloader and that went as expected (I got all the way to the PROGRAMMING COMPLETE. CYCLE POWER. message, but still no response from the 1,3 keys on reboot).
I do see that the 2 key works and invokes the Update Utility (and if I had a serial port handy I'd try that ;)).