It seems that is will only import the playlists if there are also MP3\music files in the same folder structure?

I've exported the playlists from MM to a test folder on my desktop and added that folder to the list of folders to scan in MM8, then proceeded with the scan but no tracks are added and no playlists are added. to MM8

I simplified things so that there was just one playlist left in the folder with just two tracks but this still doesn't work. The following is the text for the playlist (and it plays in MM or Windows Media Player):

#EXTM3U
#EXTINF:241,Fats Waller - Ain't Misbehavin'
Z:\Music\Early Jazz\Jazz Masters The Vocalists - 2 - Ain't Misbehavin'.mp3
#EXTINF:169,Fats Waller - The Joint is Jumpin'
Z:\Music\Early Jazz\The Joint is Jumpin' - 1 - The Joint is Jumpin'.mp3

Ideas?
Thanks!