From what you are saying it sounds like the battery has been converted ok but the memory stick is not being read.
What method did you use to make the magic stick?
Try this method, it works really well and is easy to do.
YouTube - Install Pandora's Battery Without 1.50orCFW (SLIM+FAT PSP)
If you have any further questions don't hesitate to ask.
PS. Using the above link will take your PSP straight to 3.80 M33 - 5. All you do then is a network update to get on 3.90 M33 - 2.
