Read "Troubleshooting" under the "User Guides"-Tab.
-try another USB-Drive.
-Try the usual swap-trick.
-try to start uLE indirectly through another programm, rather than swapmagic directly.
-try to start a programm through one of the "SM-Shortcuts (SMBOOT0.ELF,...)", rather than the "automatic loading".
-try to un- and re-plug your USB-Device.
PS2 V7/DMS3 V2 (FW:2.4b7); Seagate Baracuda 200GB
PS2 V7/CC1.0 (FW:34 hacked v2 BM:2.1.6); Maxtor DiamondMAX9 PLUS 160GB
PS2 SCPH-30004R; NoMod+NoLaser
3xSony MC 8MB
MAX/Datel 16MB with Boot-CD
Custom FMCB 1.8b+ Beta-Build, my AIO 0.5, Sony&xRhino-Linux