This is for anyone encountering the same problem with Firefox Sync. I was using this to sync between my home pc with FF3 and the office with portable FF4. It was stable, everything works as it should I never need to check or worried about it. Except maybe for the home pc History showing up on the office computer.
When FF4 went production, like the millions of others, I downloaded a copy and use. A few weeks later, Sync stopped working. I thought maybe the server was down or something. Noodling around gave no recent news. So I waited, and waited. A check in the comments section of this Add in reveals that lots of people are having the same issue. I waited some more.
Finally last week, I decided to try some troubleshooting. I tried to resync my work FF4. Seems that is not the original device. During the long week end, I resynced the home computer FF3 and cleaned up some bookmarks. Logged into the work computer add in the new sync code. At first I thought it was not working and was in the midst of uninstalling the Add-in when I released that some of the bookmark folder names have changed. Yippee, it is working now!
In summary, resync the original source of the bookmarks, put in the new sync code on other devices. Wait. Be Patient!