Really strange -- if you ever sort it out do let us know!
I haven't found a solution yet either - though I can try using my
camera as the card reader. I do have 2 generic card readers, both of
which work fine with XP and Windows 2003 Server, without requiring any
drivers etc. Small capacity SD cards do work for me (my 1GB and 512MB
cards work ok), it's just the 2GB cards that won't work. I tried
Maxell, Sandisk and Kingston branded 2GB SD cards.
I also tried the SD hotfix, didn't change behaviour on my PC at all.