without having my h320 near by, I think you need to do a disk cleanup, or I think it's called something like that. Anyway, that will force the iriver to scan the drive and report what amount of space is being used and how much is free.
When I first got my H320 (from the ys) about a year ago, I got this a handful of times, but haven't gotten this for quite some time now for some reason.....