Try a System Restore under Accessories/System Tools. Take it back to a date when it was working. If not click on support at the top of this page and go to drivers and downloads and reload the driver.

I have exactly the same trouble with a Latitude D620 : blue light, bt activated in the BIOS, but not detected by Windows.

No possibility to re-install drivers : "no device detected for this driver"...

Bt worked fine for many months, but is down since 2 days... and I tried a restore aged of 5 days : no result.

Hardware issue ?