Have you tried running the memory test application (one of the standard software "templates") on your flash device? You can step through your flash initialization to see what's actually failing. In order to do this, you'll need to start by setting a breakpoint, just prior to your CFI flash device's initialization in alt_sys_init.c (in your syslib project).
Additionally, my guess is that you don't have the device wired up properly. The debug output, that you're receiving, doesn't make much sense and is suspiciously repetitive. In any case, you'll be able to see what happens, in more detail, when you step through the CFI initialization.
Oh, and welcome to the wonderful world of CFI inconsistencies. :-)
Cheers,
- slacker