I had a similar issue with my dvr. I order a dvr8804 and it was a nice setup but would only send the link to the video, not an actual image and 9 times out of 10 the link wouldn't work. I was sold by the image in email feature and since I wanted to see some result of and alarm on my iphone the image was the only answer because it can't yet do java. So, I contacted the vendor and they contacted the manufacturer which even though our units are different make and models they are made by the same company which I think is axiontech. They are based in Taiwan. The person at the factory told him the new unit could not send images because it doesn't do motion jpeg recording and only did mpeg4. So I downgraded to the dvr8614 and now I get my images in the email. The systems are almost the same as functionality goes. I believe the newer version allowed larger usb drives to be used for backup and the menu was a bit nicer and it had a built in IR sensor for the remote.
With regard to the firmware the vendor tells me that they get new firmwares periodically for the units but don't release them until they are tested for 6 months. But I don't think a firmware can fix this. They just copy and paste from the description in the manual for their advertisements which is what makes it an issue.