Ok, so I have the most recent version (11.155).
I checked the file types as suggest by Matt and they are set properly (mp3, wma, jpg).
I've tried both manual and sync modes, both to no avail. I've tried both mp3 and wma when it "encodes as necessary" - nothing works.
In manual mode, I drag-n-drop a file to the device and it converts and transfers the file to the proper directory on the device. However, none of my players on that device recognize it as an mp3 file. When I copy it back to the desktop, none of my players can play it. It's a useless junk file, apparently.
In sync mode, I add a playlist and then hit "sync". It converts the file and then starts to transfer it. Before it gets to 100% the "to sync" pane shows "error" for the status of the first file. The file does not show up on my device and the device sync page shows the playlist as "to sync" again.
Very frustrating.
THanks for any help.