Did you try to launch the songs using LW or were you trying to play playlists. If you move/delete the files AFTER you create the playlists then the playlists won't work. A playlist is simply a file with a list of titles that points to the location of the song file. If the song file is no longer there, then the playlist won't work b/c it can't find it.

Personally I'd recommend you use a different player other than the LW player.