Hi @Croc,
DNS_SD_ARDUINO_OTA.ino sketch represents method of doing OTA that has been replaced / depreciated several months ago.
Did you consider upgrading your Arduino IDE to 1.6.7 or newer and esp8266 / Arduino core to 2.0.0 or newer to try the new method / BasicOTA.ino instead?
https://github.com/esp8266/Arduino/blob ... /readme.mdI do not see any obvious error in what you are doing. However, I have switched to the new implementation of OTA several months ago.
Now it is difficult for me to revert to it and check it in details. I think you will be better off getting support to what is currently supported.
I have checked other IDE like PlatformIO or Visual Micro and they support latest implementation of OTA out of the box as well.
Krzysztof