The first problem I had was that I couldn't safely remove it from my computer for some reason.
If drive is open via explorer, you can't safe remove it. Not sure if this was your issue.
And then the WD SmartWare would not shut down at all. Is there something I am not doing right?
WD SmartWare is designed to run always on as continuous backup in mind.
Another problem I am having is with my Playstation 3. I was told at Best Buy that this hard drive would work on it. for some reason my ps3 isn't reading the hard drive. Does the My Book Essential work with ps3?
Have you re-formatted to FAT32? It should be NTFS by default.