I'm going to turn blue telling people this...stop using HyperTerminal!! It's awful piece of software. Why use such a piece of junk when you can get FAR better alternatives for free?
jneiberger is right, the emulation of hyperterminal just always had a problem with translation of the the arrow-keys.
When you are so fond of hyperterminal you want to keep using it anyway, use ctrl-p instead of arrow-up. This is the original cisco-way of browsing the command history and it should work even with hyperterminal.
The better choice of course would be Teraterm...
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