Debug helper: Atmega8-SerialToggle.hex Atmega8-SerialToggle.wmv
Like seen in the video the Serial Toggle Firmware toggles the RX and TX pin (along with the LED).
Like seen the 3rd Pin in the upper row (RX, normal counting pin30) is HIGH while the LED is on and LOW while the LED is off.
The 2nd pin in the upper row (TX, normal counting pin31) is LOW while the LED is on and HIGH while the LED is off.
So you can check for short-circuits and broken cables easier...