It does indicate in the preview that all files will be synced. It then runs the sync for some time, syncs them all, and then flashes red at the end, and gives the error code "Encode Failed - unable to open file (error=BASS_ERROR_FILEFORM)"
It still appears that the sync worked, and the "device" page shows that the appropriate amount of space for the music library is now being used on the SD Card. However, whenever I put the SD Card into my phone, or unplug it and replug it into my computer, almost all of the songs are missing.