Sorry to hear about the recent issues you have been experiencing.
The Presonus Development Team is aware of this issue with MIDI in 3.5, this issue is also logged. Unfortunately, I am unable to provide a time frame for when this will be resolved. Please keep an eye out for bug fixes in Studio One update release notes.
There are a couple work-arounds.
1. Recreate or reconfigure the MIDI devices in Options > External Devices.
2. You can roll back to Studio One 3.3.4 if you like. As long as none of the songs where ever opened and saved in 3.5, they can be opened in a previous version. You can find previous versions on My.Presonus.com. Here is a screenshot: http://www.screencast.com/t/Mdrj9uEA
3. Submit a support ticket for more assistance.
Thank you for your patience,