This is a guess, but is it possible that the flash bulb itself is dead? It sounds like the electronics are working properly and the capacitor is charging (what the red light indicates) but it sounds like it can't discharge. If the blub is blown, then it isn't going to be possible for it to complete a circuit and discharge the flash. The 550 is an older unit, so it makes me wonder if that could possibly be the problem.

I don't see any more specific details in the troubleshooting guide from Canon, so it might also be worth calling them to see if they can confirm what could cause the behavior you are seeing.

I would also try removing the flash from the camera all together, putting it in manual mode and trying to see if you can get it to fire at all, but if it isn't firing at all and is indicating charge, then something would seem to be wrong with the bulb itself (or other problem down-stream from the capacitor, such as the circuitry regulating the discharge).