One thing I found absolutely essential, is that the battery is still providing power.
I believe the USB port and main power supply of this device are more or less independent of each other. So with a dead battery the USB port will still enumerate, you can send data, etc, but you will not receive a reply back from the device since that is powered from the dead battery (not from USB).
So check the battery voltage, I think it should probably be > 3.0V.
What I did on my device, is order a CR123 battery holder, remove the battery, cut the leads at the battery and solder them to the CR123 battery holder. I now have a rechargeable CR123 in it. Watch battery polarity when putting it in!