Can you describe an instance from the text where Sai Baba's Udi was used to cure a specific ailment?

Yes, Chapter 35 provides a detailed account of Udi's healing power. A gentleman from Bandra suffered from severe sleep disruption because he was visited daily in his dreams by his deceased father, who would verbally abuse him. After all his efforts failed, a Sai devotee advised him to use the Udi. The instructions were to apply a little Udi to his head, keep a packet of it under his pillow while sleeping, and keep devotion to Shri Sai in his heart. As Chapter 35 narrates, the effect was immediate. That very night, the man fell into a deep, peaceful sleep, and the bad dreams never occurred again, leaving him very happy and demonstrating the Udi's power.