Originally Posted by NSILMike
It wasn't wiped...you had a massive data corruption event. It happens usually to hard drive models (dropped for instance) but can occur on the flash units too. Your data is probably all there, but inaccessible. Look at your reserved space before you reformat and resync... it'll most likely be huge. there's your stuff, except the zune can't figure out what it is, or where one file ends, and the next one begins...
There wasn't any reserved file space when I plugged the Zune in.