I am the author of the Stats plugin and the WordPress.com stats system. The problems described here are not present in my WordPress 2.9 blog. Most users have no complaints. This is a minority issue with unknown cause.
I have offered to help debug this issue with several users claiming that Stats stopped working after upgrading to WordPress 2.9. Some resolved the problem by deactivating and deleting the plugin, then re-installing it manually. None of these users have provided the access I need to allow me to find the cause and a solution.
The last attempt got as far as this: all of the files were properly installed but the web server would not serve the flash file that displays the chart or any other file from the Stats plugin directory. When I requested the file, WordPress responded with 404 Not Found. This indicates a probably misconfigured server, for which the fault could be with the host, the administrator, or WordPress itself. I am quite sure that Stats is incapable of making its files invisible to the web server. That user gave up when I said I needed to log into their server.
I am still willing to help but I can’t do it without full cooperation from someone with an affected blog. I will need to log into your hosting account by secure shell (SSH) using your password or you will have to install a temporary key I will provide. You don’t need any technical skills of your own; you just need to be able to trust a contributing developer and Automattic employee. If you are willing, please email me at my first name at automattic.com.
Andy Skelton