I haven't been able to get my DL1 library to convert to DL2 after trying it several times. Tonight, after installing DL2 v10407, I gave it another try.
It stalled two-thirds of the way through updating, just like before. I decided to try troubleshooting one more time.
My book library has 4318 items in it, so I deleted 2,000 books from the DL1 library, saved and opened DL2.
DL2 imported the truncated DL1 library just fine. I quit from DL2, then deleted the Delicious Library Items.deliciouslibrary2 file from Library > Application Support > Delicious Library 2 so I could start again fresh.
I restored my DL1 library from Time Machine, opened DL1 and deleted the 2318 items from my library that I hadn't touched earlier. I knew they were OK because DL2 had just imported them. Now I was left with 2000 items that had not been imported into DL2. At this point, I fully expected DL2 to stall when it updated the library.
DL2 updated with no problem.
So I've proven that DL2 won't import my DL1 library if it has 4318 items in it, but it works just fine if I import that same library in a chunk of 2000 or 2318 items!
Unless I'm the only one with a large library experiencing this, it would seem there's a really nasty problem in DL2.
Which leads to my question: Has anyone successfully imported a book library of 3000 or more items from DL1?