Hi I had the same problem and after hours of annoying trying found a solution.

In my Case the Flip camcorder had allocated itself to drive J:\ which was an already in use network drive on my PC. So it was trying to use the same dirve letter.

I went into Windows Disk Manager ie Control Panel > Computer Management > Disk Management and in here changed the allocated drive from J:\ to a spare drive letter on my PC (In my case I chose V:\)

Straight awat Explorer could see the Camera and a restart of Flipshare software had everything working perfectly