Are you on a NAND by any chance? I forgot to put in the info text that that option will only work on NOR. I do know a way to trigger that recovery menu on all console types, but it involves crashing system by calling a missing plugin, so not a good way to do it, although it works perfectly every time, and i suspect it does not cause any damage, its just a system panic due to file not existing.
I am not going to release it though, See the image above your post. a joke.
BTW: If you want to translate the Reload XMB item, or the Boot OtherOS title on XMB, you need to do it in the PARAM.SFO of the included packages.
EDIT: actually, you are right, there is an issue with that option even on NOR, thanks for report, i will check it out.