OK, I'll post it again...
1) delete the vendor.xml file as previously mentioned.
2) Uninstall the 4.0 BB OS from add/remove programs
3) Install the version you want to use (I'm assume 126.96.36.199). Download it from your carrier's website.
4) Start up the application loader, it should ask you if you want to either keep the existing version of desktop tools or install the older one that's on your PC. Select install the older one. It should go to the apploader main screen and you'll see downgrade or something listed next to the OS packages.
If this doesn't
work... try downloading the java sdk from http://java.sun.com
. It will install in program files. Navigate to it's /bin directory and you should find javaloader.exe there. Type javaloader -usb wipe
This will completely erase the device. After setting up your desktop manager as mentioned above with the OS you want to install, start the apploader and reload your device.