I had this very same issue and tried all the same stuff you did op. Finally, I just forced a firmware update on the handy and that seems to have fixed the issue. Now when I first turn on online mode on the handy, Deo will give the timeout error once and then connect. This is at least working for me with local files and it hasn't timed out on me since I did this yesterday. My sub is not currently active so can't attest to the streaming functionality. Anyway, even if you have the current firmware, maybe try updating it again to see if that'll work for you guys too.