File Not Found can happen for a few reasons. A while ago this was called the freeloader response but apparently the freeloader setting only applies to the Connections screen and not transfers.

"Rebuilding the list" means that a unique number needed to transfer a shared file changed. An incoming file request contains a line such as:

GET /get/1234/foobar.ogg

The numbers before the filename change when the contents of your shared files change so old requests for your files give a File Not Found. Also, if requests come in very early when LimeWire has started but hasn't shared files yet then that will give a File Not Found since the file isn't ready yet.

Often the file size requested for a File Not Found request is wrong. A request for a bad range of the file may trigger the error.