Nice little MP3 player. I really suspect thats a SonicStage problem rather than a Microsoft one. Two good forums for SonicStage issues. 1) Minidisc.org, and 2) AtracLife.
If it were me I'd clean out SonicStage, uninstall it etc. Then install all the MS updates. Then reinstall SonicStage. If you get stuck doing this, need a hand and are in Dublin, drop me a PM and maybe I could help you. Becareful mucking around with Windows, updates and SonicStage though. Don't wreck the system, so that you need to reinstall Windows.
You need to use SonicStage because Sony (stupidly) decided to lock the player to that software. But its not limited to the format. That player plays ATRAC, MP3, AAC and WMA. While ATRAC is a nice format I'd stick with MP3's as they are more compatible with other players, that you may get in the future.
Be aware that if you do get Mac SonicStage doesn't work on Macs. (Another great Sony decision). Sony's finally stopped trying to swim upstream with their latest players some of which no longer need SonicStage.