You need to activate the advance features by going to the SETTINGS menu, tabbing down to the ADVANCE submenu, than presssing the select button so that "on" appears before Advance. Than when you press the select key when the song is playing it will be added to the favorites list as advertised. Note, there is only one play list (favorites) and its limited to 30 songs. The m230 also ignores folders and file names. All songs are organizied and played in alphabetical order by the internal file information on Song title, Album name, Artist name.
TAS! You made my day, you know its been a long monthly struggle to find the solution. Nobody at Sandisk knew the answer of course the website was no help and e-mailing them got me 0 responses. Tas your a gentlemen(woman) and a scholar thanks alot! I knew some brillent user out there had the answer. Thanks again!