I confirm there is a problem, this plug-in is no longer working in WordPress latest releases. I made a new web site using latest version of WordPress and the uDesign theme installed in subfolder /wordpress using modified index.php as per Codex and with “pretty” page name links enabled. You can see it here: https://rotarycorfu-int.org
The custom post widget was “successfully” installed. I have been testing it using my “Admin” page and some posts with Categories added. Unfortunately the “posts-for-page” calls inserted onto my main pages are not being interpreted at all – and so what is displayed is what you see when you go to the “About” page on my web site. It’s just displayed as text.