Chances of recovery are now almost nil, it almost certainly has damaged flash.

One last effort is to attempt erasure of region 41. It can hardly make it worse even if it kills it entirely. If you want to try it, replace the text command in update.txt file with this:
Code:
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If it either fails with error, or succeeds but the device still doesn't boot fully, then it's a write-off and only good for parts. It's technically possible to replace and reprogram the flash chip but that requires special equipment and skills so not worth it for such an old cheap device.