That squishing sound...
... you are hearing are bugs being eliminated. One by one, but going forward steadily. I just uploaded Nitro 0.2.2 which should be more robust and compatible. The most important change in the Nitro core is that no more out-of-band TinyTP and IrCOMM packets are sent. This might complicate matters in those cases where the peer runs out of packets or wants to use the simulated modem lines, but it prevents Nitro from crashing peer devices due to malformed packets. I might have to look into that later and re-enable these packets, but for now, I can reliably use my 3650 as a cell phone modem.
The second bigger change was the addition of the OBEX:IrXfer option for sending and receiving data. It is needed because the Newton can only advertise one IrDA class when listening, and in some cases, there is a mismatch between the class the peer device expects and the class the Newton advertises (e.g. when sending from Windows 98). The correct behaviour on the Newton side would be to allow more classes but there seems to be a hardcoded logic that only the class that has actually been set via the NewtonScript endpoint interface will be accepted. Other classes and attributes can be added to the IAS server, but they are ignored for the LSAP selector (which determines the class).
Some bugs have been fixed regarding handling of OBEX data, hopefully increasing compatibility...