OLPC Update

Clean Install

This will COMPLETELY WIPE the data from the XO... YOU HAVE BEEN WARNED

1. download the latest XO OS build (os###.img and os###.img.fs.zip) to a thumbdrive
2. rename os###.img.fs.zip to fs.zip
3. insert the thumbdrive in the XO and power off the unit
4. while pressing all four game buttons (the cluster of four buttons above the power button) power on the machine
5. follow the directions on the screen

Sources

official instructions