When you flash the new bootloader, it gets rid of that menu, which is in flashable space. Use Fn+D+M, which is in true ROM.
EDIT: Should have reread the post first. Sorry if my reply seems a bit off. Anyway, the FN+D+M menu is easier than fiddling with two bootloaders.
Hum ... that does not happen on my c760 and even with u-boot and r121 installed I stll can access the D+M menu.
You sure on this ... because also the C+D did not install u-boot correctly ... I hadto do a workaround for that too.
It appears that the D+M and Fn+D+M have some difference (one is all black and one has a red label) on my c860 (but non on the c760) .... but I still think it's not a desired behaviour on the 860 as it works differently on my 760.
Since there is no difference between Fn+D+M and D+M on the 760 coud this mean that the diagnose menu is only on rom ... and that's why it does not behave badly after u-boot install ?
In any case I can confirm that Fn+D+M will get the diag menu up again with c860 + r121.