No, the power LED remains on, as normal. The LAN connection with the PC also remains on. Only the ADSL light goes off when the broadband connection is dropped, and comes back on when the connection is restored.
Hi Essbebe,
Thanks for your suggestions. They have not changed the status, unfortunately, ie, the connection still drops as it did earlier.
Here's my feedback from each recommendation:
1. ADSL2+ disabled
2. TR_069 was already disabled.
3. SOAP - could not find this option in any modem menu (* in same page as above. Ignore )
4. Latest firmware downloaded and applied successfully. ( *good)
5. "Always On" mode
6. ipconfig o/p:
Windows IP Configuration
Host Name . . . . . . . . . . . . : homepc
Primary Dns Suffix . . . . . . . :
Node Type . . . . . . . . . . . . : Unknown
IP Routing Enabled. . . . . . . . : No
WINS Proxy Enabled. . . . . . . . : No
Ethernet adapter Local Area Connection:
Connection-specific DNS Suffix . :
Description . . . . . . . . . . . : Realtek RTL8139/810x Family Fast Ethernet NIC
Physical Address. . . . . . . . . : 00-0B-6A-44-C4-57
Dhcp Enabled. . . . . . . . . . . : Yes
Autoconfiguration Enabled . . . . : Yes
IP Address. . . . . . . . . . . . : 192.168.1.2
Subnet Mask . . . . . . . . . . . : 255.255.255.0
Default Gateway . . . . . . . . . : 192.168.1.1
DHCP Server . . . . . . . . . . . : 192.168.1.1
DNS Servers . . . . . . . . . . . : 192.168.1.1 ( *Opendns can be tried )
192.168.1.1
Lease Obtained. . . . . . . . . . : Monday, 06 July, 2009 9:12:36 PM
Lease Expires . . . . . . . . . . : Tuesday, 07 July, 2009 9:12:36 PM
The problem still persists!

Is there anything further I can try? I appreciate your suggestions.
As a further update, I also tried switching to Dialup mode after updating the firmware and the other changes, but this did not solve the problem, so I've switched back to "Always On" mode again.