Unable to boot Pi successfully with ethernet interface configured

[Sevan / Venture37]

Hi,
My Pi rev2 hangs after smsc0: chip 0xec00, rev. 0002 on boot if I have 
ue0 configured in my rc.conf,
with the interface configured to use DHCP the system hangs & issuing ^C 
result in
smsc0: warning: Failed to read register 0x114
smsc0: warning: MII is busy
Issuing ^C again results in
smsc0: warning: Failed to read register 0x118
Issuing ^C a third time reverts back to first warning & repeats.

Configuring the interface with a static IP address automatically spits 
out smsc0: warning: Failed to read register 0x114
smsc0: warning: MII is busy & then hangs. Pressing ^C just prints out 
smsc0: warning: Failed to read register 0x114
smsc0: warning: MII read timeout
& not 0x118


Sevan