I've run into a couple bad USB cables. Chances are some of you may have also received a bad cable with your CBT. If you have trouble try another cable.
I've got brownout (low voltage) detection enabled on the Atmega for safety. If you like disabling it seems to stop the resets with a faulty USB cable. Just write 0xFF to the Extended fuse to disable BOD, but this requires a JTAG programmer or an Avr ISP.