Originally Posted by chickentrout
Doing it this way requires you to have (or have access to) a second GT that's connected to LIVE.
The way I did it does not.
Firstly; make sure that you actually have the DLC. I know this sounds stupid but the way I read the road guide in the achievement list made it seem like the update was all you needed for the dlc to be active and that is certainly not the case.
So what I did was download the dlc, delete the cache and re-download the update. It wasn't until after I did all of that, that the option reappeared in my menu.
This way didn't work for me, but I have a second Silver account and I did as the OP described and it worked