Were you able to somehow verify that the BIOS really upgraded to 38? If not, I wonder if you might be using a Microsoft keyboard and whether you might have access to some non-Microsoft keyboard to try. When my DN2820FYKH arrived I was not able to do those F2-F7 using any of my keyboards (all varying models from Microsoft) but then I got a different brand keyboard and was able to use the key and upgrade BIOS. With the later BIOS, my Microsoft keyboards worked.
I can't help with the bootable USBs - when BIOS setup is functioning it makes sense to double-check settings such as Legacy boot and Optical boot, etc.
Yes I'm sure, cause when I runned BIOS recovery update again, you can see your actual version.
I use a Microsoft, but I've no other keyboard whatI can try at the moment.
Right now I try to workaround with Intel® Integrator Toolkit I changed the default settings from latest BIOS so USB device is first boot device.
Seems to be working..