I encountered the exact problem w/ my NS-DVDR1.
Interestingly enough, after aprox 20 minutes of Googlin' around for a possible solution (which I never found), I noticed that my NS-DVDR1 stopped displaying the "Hello" message and then the Setup menu appeared on my TV set. At this point I was able to insert a DVD into the unit - I thought the problem was resolved. Unfortunately, this was not the case - After I powered down the unit and then restarted it again, the evil Hello message reared its head and did not go away (I waited for over 30 minutes).
I opted to call Insignia's customer support (877-467-4289). The tech support guy told me that I have a malfunctioning unit and that I will need to take the NS-DVDR1 back to where I purchased it from (BestBuy).
Jed, January 2007