I just sent my Red Quarq back in for servicing for similar issues.
It worked fine for about the first six months, then in October it stopped sending power to my Garmin. Cadence, however, came through fine. I contacted Quarq and did the reset with the battery, replaced the batter, updated the Garmin firmware and even did a hard reset of my Garmin, but nothing worked. I sent it in to Quarq, who said there was some issue with the battery connection. They sent it back fixed. Everything worked fine for a couple of weeks, then I started getting the same power drops. Cadence would come through though.
And then a couple days before Christmas, I got the power to come back, but I was getting major power drift. I started out doing about 100 watts, then it was 150, then 200...250...300... 350... Pretty soon, I was putting out more than 600 watts without breaking a sweat. I did a battery reset, and power went back to a normal range, but soon started climbing again.
I shipped it back to Quarq earlier this week and am just waiting to get it back. I hope it is fixed for good this time.