i don't know about using playlists, but i bought the Sansa for my wife also (2GB). after a day with Real Player her laptop's security software fritzed out and other programs got sketchy... i reinstalled everything from scratch and went with what i use to load my Sanyo M1 cellphone... Media Monkey. it's got to be the best media player out there and it's free... get it here in the downloads section.
my biggest gripe for the Sansa is that is says you get 2GB's to use, but it says it's full when it hits 1.4GB's. i emptied all the useless stuff they add on before they ship it, but still can't figure where the last .6GB's went! i'm gonna have to get her a micro sd card now instead of later...
I bought a Sandisk Sansa for my wife, despite the fact that I encouraged her to go with a Creative Zen V, ever since that day my experience with that player has been filled frustration and a bunch of cursing. I use Real Music Store for my online purchases and thinking that since Sandisk and Real just recently partnered I thought things would be seemless was I ever wrong.
First I couldn't play tracks that I bought from the music store, it was a DRM problem. I would up re-installing real on her laptop, then upgrading to WMP 11 and it worked.
As with any MP3 user you don't really use playlists until your library starts to grow well wifey is at that point and playlists are just not working on this thing at all. My first big complaint is unlike creative or apple the Sansa doesn't come with it's own music organizer software, Big mistake, BIG mistake. The documentation says that you can use WMP 10, but when I had it my online purchases wouldn't work so now I'm stuck.
If anyone has any answers please I'm more than open here, if anyone is considering a Sansa DON'T buy them. This playlist issue is reason enough, despite how pretty it looks, this thing is anything but easy to use and that should weigh heavily into any MP3 purchase