I have tried several times to upgrade Play 1 and even with extended from Sonos helpline, failed to complete the process.
Here is what eventually worked:
Connect your Play 1 with a network cable to your router, power on your Play 1 while holding down play/pause, wait until it flashes orange and then you can release.. After approx. 2min it flashed green. DO NOT REMOVE THE POWER CABLE OR DISCONNECT FROM THE CABLE FROM THE ROUTER.
Go to the app, the Play 1 should be visible and require adding to your system. Add it to your system and agree to the prompts to upgrade the speaker. Continue to follow the app prompts which then successfully updates the Play 1. Then disconnect the cable, and add it to your Sonos system following the + a speaker process of the app.
It seems that staying directly connected to the Sonos web site via a cable worked for the UPGRADE rather than restarting and connecting via the app through your wifi. Hope this helps if all else has failed.