A similar problem with Palm PDA HotSync
I see that this thread has not been active for quite a long time so this posting may not be seen by anyone. However I stumbled across the thread via Google today when looking for help with a similar problem I was having with my old Palm Tungsten E2. The solution was contained in the posting from raj1402 but an addtional step turned out to be required. I do not know if this applies to any of the other problems posted.
When I had installed the Palm Desktop software directly into XP mode (which caused no problems) I pressed the HotSync button on the USB cable but just got the W7 "failed to connect" sound with no HotSync activity. The Palm PDA then reported that a connection could not found. After finding this thread, I clicked on the USB menu button at the top of the XP Mode screen but the Palm PDA was not listed. However, on clicking the HotSync button again and then clicking on the USB button while the PDA was still trying to connect, I found that it had now appeared in the list. When I clicked on Attach, the HotSync proceeded normally.
In other words, it seems that the USB device must be active if XP Mode is to find it.