I am using 2.6.20 kernel, pretty old but works fine. The latest LTIB BSP is 2.6.23, how do you upgrade to 2.6.31?
If your cpu has silicon rev. 2.0 or 2.1, you may need to check the document "Migration from MPC8313E Revision 1.0 to Revision 2.x". Some software modifications are necessary.