I have also encountered both issues ("remote server communications..." and asking for login credentials) over the past few days when trying to download the update. I've figured out why it asks for login credentials....the download seems to be good for a limited time. After that time is up, it asks for login credentials and won't ever log you in. To fix this you'll need to download the "downloader-xxxxx.jnlp" file again, and you shouldn't be prompted for login credentials when running it. You'll notice if you download it multiple times the number at the end changes - this is probably how they keep track of which ones are still valid.
I think the reason entering your myaudi login credentials doesn't seem to work is the downloader is trying to authenticate you with some German Audi site, and possibly it doesn't share the same database. I found this when looking through some logs that are written when it fails.
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