owen,
you´re talking about differnt things.
1.) I guess your FCP seams to be messed up.
normally it doesn´t matters on which exteral drive your FCP-project has been saved, it should work everywhere.
which version FCP do you use and which os do you have?
2.) “this project is formatted for windows so can’t be opened on your mac” is another ugly bug from encore, it used to be fixed within encore CS5. even pc-projects could be opened on mac and vice-verca.
3.) why you used m2v instead of h264? h264 have a better picture-quality with lower bitrate.
finally: encore CS3 is horrible, CS4 is a big mess, even encore CS5 but it´s a lot better and have a lot improovements and bugfixes.
cheers
danny