Okay, so I see a lot of people complaining about the game not loading after the update, I am not however seeing anybody actually providing any information to help get it fixed; let me be the exception here:
From what I can see, a number of files are not being downloaded with the installation of the game. I had one file, which a friend ended up sending me: models/w_kevlar.mdl. After adding that file, I had another file that was missing: models/w_assault.mdl. There are likely others which I won't know until after I get this file from my friend.
From what I can tell, the update has misplaced a number of files & is not being downloaded through new installations. The difference between what I did & what my friend did is that he used Steam backup to backup & restore the game to get the registry keys rewritten with path information to the game. I on the other hand uninstalled the game & redownloaded to get those keys rewritten. He appears to be able to run the game while I am not able to.
To make things short & simple, it appears that a number of files got misplaced after the conversion & because of that, the game can no longer run. I am waiting for an update so we can update our support for the game on Xfire.