When a smart card is in the ebw 1150 it replaces the internal book storage memory. That is to say whatever you have stored on the internal memory is still there the reader just doesn't see it. It only looks at the card so the internal memory really isn't a factor when you are using a card.
When you remove your smart card with the ebw 1150 turned off of course turn the reader back on and then off again before inserting the card then power it up again. I've had mine do some strange things a couple of times if I skipped that step, although never what you describe.
For the bookshelf management you might try either
impserve available from ashkulz or
REB Librarian which is now a free program to download I think.
I use impserve to get my books onto my reader the only time I've used eBookwise's online book shelf was to get the dictionary for the reader.
Hope you can get this sorted, maybe someone else with a little more know how on hardware problems can give you some pointers.