http://code.google.com/p/arduino/issues/detail?id=368

Optiboot does not support ArduinoasISP programmer.

When avrdude runs and talks to an arduino running ArduinoISP,
it needs the optiboot (entered due to auto-reset) to abort and
start the ArduinoISP "application" when it sees communications
at the wrong serial speed.  Unfortunately, optiboot treats all
unrecognized command characters as "no-ops" and responds/loops
for more commands, leading to a nice loop that never gets to
the sketch.   This patch causes characters received with Framing
errors (the most likely error for speed mis-matches) to NOT
reset the watchdog timer (normally done in getch()), which will
cause the application to start if it continues for "a while."
(tested.  Works!  Running ArduinoISP at speeds as high as 57600
still causes the bootloader to start the sketch (although it fails
later on for other reasons.))
(cherry picked from commit e81c1123b624b6cac7da018c9c786700f3152bc9)

Author: WestfW

bootloaders/optiboot/README.TXT

@@ -27,7 +27,7 @@ this may change if compiler versions drift apart between CrossPack and
 the Arduino IDE.)
 
 
-Building optiboot in the arduino IDE install.
+Building Optiboot in the Arduino IDE Install.
 
 Work in the .../hardware/arduino/bootloaders/optiboot/ and use the
 "omake <targets>" command, which just generates a command that uses
@@ -44,7 +44,7 @@ the programs it needs, so you need to work in the existing optiboot
 directory (or something created at the same "level") for it to work.
 
 
-Building optiboot in the arduino source development install.
+Building Optiboot in the Arduino Source Development Install.
 
 In this case, there is no special shell script, and you're assumed to
 have "make" installed somewhere in your path.
@@ -53,3 +53,18 @@ expected directory.
 Work in Arduino/hardware/arduino/bootloaders/optiboot and use
     make OS=windows ENV=arduinodev <targets>
 or  make OS=macosx ENV=arduinodev <targets>
+
+
+Programming Chips Using the _isp Targets
+
+The CPU targets have corresponding ISP targets that will actuall
+program the bootloader into a chip. "atmega328_isp" for the atmega328,
+for example.  These will set the fuses and lock bits as appropriate as
+well as uploading the bootloader code.
+
+The makefiles default to using a USB programmer, but you can use
+a serial programmer like ArduinoISP by changing the appropriate
+variables when you invoke make:
+
+   make ISPTOOL=stk500v1 ISPPORT=/dev/tty.usbserial-A20e1eAN  \
+        ISPSPEED=-b19200 atmega328_isp

bootloaders/optiboot/optiboot.c

@@ -132,13 +132,16 @@
 /**********************************************************/
 /* Edit History:					  */
 /*							  */
+/* 4.3 WestfW: catch framing errors in getch(), so that   */
+/*             AVRISP works without HW kludges.           */
+/*  http://code.google.com/p/arduino/issues/detail?id=368n*/
 /* 4.2 WestfW: reduce code size, fix timeouts, change     */
 /*             verifySpace to use WDT instead of appstart */
 /* 4.1 WestfW: put version number in binary.		  */
 /**********************************************************/
 
 #define OPTIBOOT_MAJVER 4
-#define OPTIBOOT_MINVER 2
+#define OPTIBOOT_MINVER 3
 
 #define MAKESTR(a) #a
 #define MAKEVER(a, b) MAKESTR(a*256+b)
@@ -512,8 +515,6 @@ void putch(char ch) {
 uint8_t getch(void) {
   uint8_t ch;
 
-  watchdogReset();
-
 #ifdef LED_DATA_FLASH
 #ifdef __AVR_ATmega8__
   LED_PORT ^= _BV(LED);
@@ -547,7 +548,20 @@ uint8_t getch(void) {
       "r25"
 );
 #else
-  while(!(UCSR0A & _BV(RXC0)));
+  while(!(UCSR0A & _BV(RXC0)))
+    ;
+  if (!(UCSR0A & _BV(FE0))) {
+      /*
+       * A Framing Error indicates (probably) that something is talking
+       * to us at the wrong bit rate.  Assume that this is because it
+       * expects to be talking to the application, and DON'T reset the
+       * watchdog.  This should cause the bootloader to abort and run
+       * the application "soon", if it keeps happening.  (Note that we
+       * don't care that an invalid char is returned...)
+       */
+    watchdogReset();
+  }
+  
   ch = UDR0;
 #endif
 

bootloaders/optiboot/optiboot_atmega328.hex

@@ -1,33 +1,34 @@
-:107E0000112484B714BE81FFE3D085E08093810004
+:107E0000112484B714BE81FFE7D085E08093810000
 :107E100082E08093C00088E18093C10086E0809377
-:107E2000C20080E18093C4008EE0BCD0259A86E039
+:107E2000C20080E18093C4008EE0C0D0259A86E035
 :107E300020E33CEF91E0309385002093840096BBD3
 :107E4000B09BFECF1D9AA8958150A9F799249394D1
 :107E5000A5E0AA2EF1E1BF2E9DD0813421F481E06E
-:107E6000AFD083E01FC0823411F484E103C08534B5
-:107E700019F485E0A5D083C0853579F48BD0E82E40
+:107E6000B3D083E01FC0823411F484E103C08534B1
+:107E700019F485E0A9D083C0853579F48BD0E82E3C
 :107E8000FF2488D0082F10E0102F00270E291F296B
-:107E9000000F111F8DD0680172C0863529F484E06F
-:107EA0008FD080E06FD06BC0843609F042C072D0B2
+:107E9000000F111F91D0680172C0863529F484E06B
+:107EA00093D080E06FD06BC0843609F042C072D0AE
 :107EB00071D0082F6FD080E0C81680E7D80620F474
 :107EC00083E0F60187BFE895C0E0D1E063D08993F5
 :107ED0000C17E1F7F0E0CF16F0E7DF0620F083E0C3
-:107EE000F60187BFE89564D007B600FCFDCFA60178
+:107EE000F60187BFE89568D007B600FCFDCFA60174
 :107EF000A0E0B1E02C9130E011968C91119790E0C8
 :107F0000982F8827822B932B1296FA010C0197BE8B
 :107F1000E89511244E5F5F4FF1E0A038BF0751F79D
 :107F2000F601A7BEE89507B600FCFDCFB7BEE89501
-:107F300026C08437B1F42ED02DD0F82E2BD038D0D7
+:107F300026C08437B1F42ED02DD0F82E2BD03CD0D3
 :107F4000F601EF2C8F010F5F1F4F84911BD0EA9435
 :107F5000F801C1F70894C11CD11CFA94CF0CD11CB4
-:107F60000EC0853739F424D08EE10CD085E90AD0D3
-:107F70008FE098CF813511F488E014D019D080E1DA
+:107F60000EC0853739F428D08EE10CD085E90AD0CF
+:107F70008FE098CF813511F488E018D01DD080E1D2
 :107F800001D06ACF982F8091C00085FFFCCF9093DD
-:107F9000C6000895A8958091C00087FFFCCF80910E
-:107FA000C6000895E0E6F0E098E1908380830895AC
-:107FB000F1DF803219F088E0F5DFFFCF84E1E2CF16
-:107FC0001F93182FE7DF1150E9F7F2DF1F91089593
-:0A7FD00080E0E8DFEE27FF270994A8
-:027FFE0002047B
+:107F9000C60008958091C00087FFFCCF8091C0008B
+:107FA00084FD01C0A8958091C6000895E0E6F0E048
+:107FB00098E1908380830895EDDF803219F088E0A6
+:107FC000F5DFFFCF84E1DECF1F93182FE3DF1150E1
+:107FD000E9F7F2DF1F91089580E0E8DFEE27FF2741
+:027FE000099402
+:027FFE0003047A
 :0400000300007E007B
 :00000001FF