I have the same issue, with 2 files in the directory. When I hit “FF”, it performs the same function as “Next”, ie, it jumps from one file to the next. Do you have a single file in the directory? If so, the “Next” file may be the same file you’re currently playing, so it jumps to the start of that file.
In my case, the files are 3 hours long (this happened last night when I was listening to Rigoletto), and trying to get back to where I was is a _major_ pain. These are .wma files, which don’t have indices, and include a set of headers at the start of the file, so I can understand that playing them off-speed is a little tricky, but mplayer does it without any problems (and can even jump backward).
On the theory that it might work if there was an index track, I tried converting to an audio-only avi ("ffmpeg -i src.wma -acodec copy dest.avi). Mplayer has no problem with the file, but the WD plus live won’t play it. To be fair to the WD, ffmpeg did _not_ create an avi file (it doesn’t start with “RIFF”, doesn’t include “auds” or “LIST” packets, etc). I also tried converting using mencoder (“mencoder src.wma -o $dest.avi -oac copy -vo null”), but mencoder doesn’t want to convert unless there’s a video track). There may be some way to take a black mpeg-2 video file and the wma file, and use those as a group for mencoder. I’ll let you know if I have any luck.
A possibly work-around in WD firmware to handle off-speed play for non-indexed files: First determine the bit-rate of the file (known soon after decode starts). When the user hits FF, seek forward about Nx that number of bits during each audio frame interval, read until re-synchronized with the packet structure, then play 500msec worth of contiguous audio packets; repeat every 500 msec. The user probably doesn’t care too much about audio during off-speed play, other than knowing the current location in the file, so the WD doesn’t need to prefetch the contents it seeks past. I’d suggest N be chosen so that FF will go from start to end of the file in one minute; in other words, make it proportional to the size of the file being decoded.