I had problems w/ 5.1 as well but for me it was the loss of a functioning Netflix and Hulu Plus features. Downgrading to 5.0.2 restored my Apple TV's fully. Here is a Apple Forum thread that gives the instructions on how to accomplish this:

https://discussions.apple.com/thread/4372428?start=15&tstart=0

The Oct 2012 update bricked my Apple TV-2, although the update went the same as previous updates and the unit worked for a few minutes. Then, next time I restarted it got stuck on "Whats New?" screen (the Continue button would not respond.) After about 7 minutes wait it went to the Home Screen but without response from the remote (I changed in a new battery too.) Then it went to the screensaver and stayed stuck on that. It refused to soft-reboot. I could not restore it either as iTunes (via Micro-USB cable) on my Macbook would not recognize the ATV2. (I tried all kinds of permutations and two Micro-USB cables.)

So I tried putting the ATV2 in DFU (Device Firmware Update) mode using iTunes in Windows 7 (Pro) on Parallels (7). This worked.

Here is How to Put the Apple TV into DFU Mode: (I had to try variations on this to get iTunes to see the ATV2 in Devices.)

Note: You will need a Micro-USB cable to connect your AppleTV with iTunes-for-Windows running.

Step 1: Connect the ATV2 via Micro-USB to computer.

Step 2: Hold menu+down for 6 seconds to reboot. (As that did not work for me I had to disconnect/reconnect power instead.)

Step 3: Then immediately hold Menu+Play (on the ATV2 remote) to go into DFU mode. (Rapid flashing followed by less rapid flashing.)

It (eventually after restarting iTunes, Windows etc) showed up in iTunes/Devices just like an iPhone etc.

Click Restore.

I then had to babysit the update as there are a number of messages to be OK-ed, and, at one time, iTunes for Mac began starting up.)

Back to normal (for now.)

This process was tenuous and required patience - I almost gave up trying to get iTunes to see the device.

[There's probably a hardware issue on some devices (different vendors?). Apple should exchange these defective units for refurbished ones. After all it's their software update that broke the units.]