Airplane mode does not help
I had mine in airplane mode last night and it droided me until I shut it off. My wife (deaf since birth) has a hearing service dog. Gemini. He alerts her to the sound of the special ring sound on the phone. The sound plays for text messages, and email and the alarm clock. Then Gemini alerts her. So, turning off the phone is a bit of a problem as he will not respond to sounds he is not trained for. I cannot just set the alarm for her on the bedroom clock. In airplane mode, it rules out some sort of signal sent to the phone and must be something internally scheduled.
worked for me on three different phones
wipe the cache before you go to bed
leave on wifi, turn off volume, plug it in (in another room)
go to bed
i've heard reports that there was something in the cache causing the phone to boot up incorrectly with the update that has spread. Don't know how much of it is true. Regardless, i wiped my ohone's cache and then let the thing run over night. I don't know if it droid-ed itself to death or if it took the update in one reset, but its been almost a week for the first phone and a few days on the other two and we havent noticed an issue since. I'll let each of you figure out how to wipe the cache on your particular device because i just realized the button sequences are different depending on your device (just make sure you dont do a factory reset instead of wiping cache. you will lose everything including installed apps). Good luck.
Update with Reboot at 2:00 am
My husband and I both received the update on the same day and we both have the same problem. I have lost a lot of sleep and I found this forum over the weekend and I did a factory format on July 7, 2012. The factory reset didn't fix the problem. So, I searched and found this forum. So, today I called provider and gave info and this early morning I've now formatted the SD-Card (not on phone) but on computer so card would be completely clean (including hidden files).
This problem of rebooting from 2:00 am (I literally watched this happen from 2-3 am) and it rebooted 30 times. Every 2 minutes I heard Droid!
I witnessed that the issue disables the Wifi and disables all applications. The only way to keep the rebooting from happening is if your phone is off. I followed the directions of one person in the forum BrandonBob. I will find out if SD format fixes problem but I really don't want to hear Droid any longer! I will soon find out what happens tonight!
could be the backup assistant
I haven't tried this yet, because I am at work, but I've done some research and it seems what could be causing this is the Backup Assistant that came with the update. I've found a way to remove it, but your phone needs to be rooted.
The phone might be restarting from 2-5/6:30 AM because that's when the BA turns on to back up everything - EVERY night, even if files haven't changed. People have been getting outrageous data usages that are only viewable via their online accounts- not My Verizon app you can install and use on your phone for a quick glance at data usages -- and the running time for the data use is consistently from 2AM until morning, at reccurring intervals, the same times each night.
How to Remove Verizon Back-up Assistant from LG Ally (or other Android Phones) | Eagle4life69.com
you can also go through settings into accounts and sync and uncheck Automatic Syncing, and you can force stop backup assistant sync services from manage apps. However, you cannot manually delete BA from the phone unless you try the rooting mentioned above - and the BA will restart every time you reboot your phone (you will have to force stop/clear data after each reboot).