the nas and the (windows) pc running the fvdw-sl console should be on the same lan, preferable via a router and wired connections. Dropouts in wireless connections can make netcat miss the trigger signals and confuse the console, but in principle it should work as well.
Furthermore your network should have ip's 192.168.1.xxx or 192.168.0.xxx. I assume you are also aware of the meaning of netmask setting. Typically a router uses a netmask 255.255.255.0 that means you can only connect to devices that have the same first three octets. So if you router uses as pool ip pool 192.168.1.xxx and has netmask set to 255.255.255.0 you cannot connect to ip's that do not start with 192.168.1
So be sure you router uses one of the above mentioned ranges.
The ip address mentioned in the console is the ip address for the nas not your PC (the ip of your pc is mentioned separately in the console window)). If you router uses 192.168.1.xxx then set it to 192.168.1.252 (=the default value), if it uses 192.168.0.xxxx change it to 192.168.0.252
When using the standalone kernel loading feature this ip is used by the telnet client to connect to the nas.
After boot is interrupted then the u-boot console window should show a command prompt shortly and it should automatically continue and start to upload the kernel to the nas (assuming you used the action load standalone kernel) the progress will be visible in the u-boot window. After that is finished the u-boot window will close automatic and after 12 seconds the telnet client window will appear and the client will try to connect to the nas using the ip address set in the console.
The standalone kernel will assign the nas two static ip addresses 192.168.1.252 and 192.168.0.252 and also it will try to get a dynamic ip address from the dhcp server in your lan (normally your router). The telnet client will by default use the ip address set in the console to try to connect to the nas. If it is set to 192.168.1.252 then the telnet client of the fvdw-sl console will use that to try to connect, if you have set it to 192.168.0.252 it will use that one
You can also set the ip address in the telnet client yourself by using the connect menu of the telnet client.
Sometimes the standalone kernel needs more time to boot, especially when there are disk problems. In that case the telnet client may try to early to connect to the nas while the telnet server is not yet running. If that happens just try again after a while to connect using the connect button in the telnet client.
ps the fact that you get the two red flashes indicates that the console has interrupted the boot, so you must be doing something wrong in the setup or you have chosen the wrong action from the action menu.
Hope it is more clear now...and the help menu in the console gives quite some explanations