I think I might know a way around the FTP D Drive problem.
After reading your posts on Xbox-Scene forums and here, mintoman, I decided to fire up the dash with something in D drive to see if I had the same problem as you.
The Drive letters are listed like this:
C
DVD
E
F
G
MUSIC
TDATA
UDATA
So, I clicked on "DVD", thinking that it would open the dvd folder. Lo and behold, I had the same problem as you, when I click on "DVD" it says "Path not found."
Since that message indicates that the path, i.e. "DVD", is not valid, I decided to type in just "D", since that is the standard path for the DVD drive, and I was able to access it.
So, if you want to access the D drive, you have to type in D manually. I don't use Flash FXP, so I don't know how you would do that with that particular software, but there must be a place to input a path.
I am sure that the 2G Collective will come up with a proper fix for this, whatever the problem is, but for now if you want to access the DVD-ROM drive, you must type in "D" as the path. "DVD" doesn't seem to work, at least for some people.
If any of my information is incorrect, I am sure someone will let me know.
Hope this helps.