Version 4.0, but I think it used to happen in 3.5 too.
It's freaky, I had to do a hard reset once, and left my SD card in the whole time - ended up manually reinstalling all my apps because just doing a sync put it in the same crashloop that caused the hard reset. So I reinstall iSilo and of course it was set to automatically refresh and display all files. So it found all my mobipocket (or whatever) .prc files as well as all my iSilo files. And the prcs didn't disappear off the list until I removed the SD card, did a refresh, put it back in and refreshed with it only having display isilo files checked.
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