Tried 1st Hard reset ( press power-on then reset button under the unit) but still hang on O2 logo.

So made some searches, found one possible solution is to flash or upgrade rom of unit.
For all rom versions you can download here:
Collection of All O2 XDA ATOM ROM WM5,WM6 & WM6.1
http://forum.xda-developers.com/archive/index.php/t-329037.htmlI used ORIGINAL-FACTORY DEFAULT Xda-Atom-ENG-20060426-MOT0822.exe .
http://www.mediafire.com/?1ltj5urx7rn Since I do not know original rom version of unit.
Now to flash or upgrade rom
-make sure battery is fully charged
-Put unit in download mode hold camera button then with stylus press soft reset button at bottom of unit. same lika making hard reset but you are pressing camera button

-now start Atom-ENG-20060426-MOT0822.exe . double click icon to install soft.

- connect unit using mini usb cable to pc usb port. tick next tab


-Now tick upgrade tab

-flash progress has 5 stages. Do not do anything just wait for all 5 stages to finish completely

-Now process is completed successfully follow on-screen instruction of software
Downloading fw to unit:


Finished product

$$$$$$$$
b.r.