Feck. Good catch. Tough to fix cleanly, though.
Essentially, it's because "Unattached Items" is still in there, just not displayed. Thus, the list count (w/o Unattached) doesn't agree with the playlist child count (inc. Unattached), and the button is erroneously enabled.
This causes an ASSERT in the debug build, or the crash that you're seeing in the release build.
Anyway, I'm out of the office until next week, so I'll put it into the bug database and see if someone else wants to fix it.
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roger