I got my issue sorted out. I had to delete the previous update file (update 2) before it would allow me to check for new updates.
Thanks to tantonsen in this thread: http://xpenology.com/forum/viewtopic.php?f=2&t=1959
Hi, If ur all ready on Ver2
You must remove files autoupd@te.info from the root folder (rm /autoupd@te.info* via SSH) and follow instructions again:
Download DSM update 3, execute code below and finaly install update.
sed 's/flashupdateDeb/flashupdateDeb1/' /autoupd@te.info > /autoupd@te.info1
mv /autoupd@te.info1 /autoupd@te.info