You still seem to have FTP access. That means the softmod is still working. The orange LED is also probable additional confirmation of that.
What this means is the dashboard is damaged, possibly JSRF or another game tried to update it, or you accidentally deleted an important file or folder.
It should be be fixable but first backup your eeprom - you say you don't have the "HDD key" but that E:\Eep-bak folder looks like you. FTP that to your PC as a priority and if you have an "eeprom.bin" inside it that is the important thing.
Do you know what softmod was used? What dashboard were you using?
It would also help to see just the main contents of both C:\ and E:\ so we can work out where your dashboard should be. If you have a Dash or Dashboard folder on either drive then the contents of that would be useful too.
All that may be necessary is to FTP in a replacement dashboard XBE but it must be named correctly and installed in the correct location. That varies with the softmod so the information about exactly what is on your C:\ and E:\ drive is vital