I have read that the PRS-505 is not compatible with SDHC, and the SD slot can accommodate up to 2gb SD cards (although some standard (non-standard?) SD cards with 4gb capacity may be compatible.) I have a 4gb SD card (not SDHC) which I plan to test in my 505 when I get it tomorrow. Not sure if the SDHC issue is the cause of your issue, but I would surely suggest you try it on an SD card (not SDHC) to see if the problem persists.
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