After 2 days of searching useless posts and “fora”:
1st - Yes I have the latest everything. Firmware, SMC, SMC2 (required to see the bloody Fuze), XP Sp2, Quicktime updates etc. Video files converted and copied to the Fuze do not show up. Had the same problem with audio files until I relinquished total control to WM11.
2nd - Please do not answer this post with thoughts and opinions. An informed answer about file/folder structure would be nice. And what the heck Sandisk was thinking. Is simple drag and drop beyond the realm of their understanding?