Arjb: I tried your program on Psoc Creator 3.3 on a windows 10 machine and it complied and loaded with the bootloader and it starts out with the led on and then when you press the button the LED blinks. I can see no problem with your program so it must be your drivers for the programming machine, You could try to re-install Psoc Creator 3.3 again.
I did just that, un-installed all Cypress PSOC versions 3.2 and 3.3. Then just installed version 3.3.
Unfortunately the problem did not go away. I 'Cleaned and compiled' the application, but even then the kit does not run. I suspect the bootloader host program could be the problem....
After I upgraded to 3.3, the programmer software fussed about each of my boards in turn:
Prog version Expecting 2.12, but found 2.11. Please use PSoC Programmer GUI to upgrade firmware.
Is it possible you were getting this message but it was being hidden somewhere you couldn't see? You might want to upgrade the programmer firmware anyway, on general principles.
Can you create the technical support case in cypress.com website, by Cypress.com-> Design support-> Create a support case to create the technical support case.