OK. update: out of sheer frustration I formatted the e507 to FAT using windows xp explorer. halfway through the format I read another thread on this forum: http://www.atraclife.com/forums/index.php?showtopic=3553 which describes basically turning the e407 into a shiny paperweight from doing the same thing. I was worried, but let the format finish. Whe I unplugged the unit, the LCD screen said "Format Error". I formatted through the advanced menu, and then it displayed the sony walkman "blank track". The unit was still blank in explorer - I tried installing MP3File Manager, but of course it did not work. In the end I installed SonicStrage - transferred one track, and it played fine! It put all the missing folders back (NWWM, OMGAUDIO) and the track played OK. I then copied a backup copy of MP3 File Manager back onto the unit, and it ran OK, displaying the tracks correctly etc. I uploaded one track to the 507 using MP3FM, but again.. "Cannot Play". I deleted the MP3FM folder and ran the original installation program, but it could not detect the e507 to install the program. Weird. Well, at least I can still use sonicstage for the time being - but I'd really like to work this out!