I've got an arc and just done an update although everything is generally fine, on searching contacts thing a t9 style it doesn't allow you to use predictive txt. The green light won't go on. By changing the setting to swipe left to turn on predictive then the green light comes on but nothing displays!
On swiping back turning t9 off as soon as you press a letter all of the predictive buttons pressed appear. Though before the update this was always fine.