For Filenames: I don't use a connected phone for playing music, only a USB thumb drive. However, I expect the behavior between the two sources is probably the same. If you have a long name tag (or just filename, if you don't use tags), the current software won't/doesn't scroll the entire filename on the display. For example, if you have a file tagged "Gustav Holst: The Planets - Jupiter", you'll only see "Gustav Holst: The Pl" on your display - so you'll never see the rest of the filename title. This especially sucks for classical music that has long titles. The system design spec for folder structure is 20 directory layers max, max 255 bytes folder/file name length (not a Tag limitation), max of 2,000 folders including root, and a total maximum of 8,000 files per device.
For Filetype Support: The Palisade supports MPEG-1/2 Layer 3, OGG Vorbis, FLAC (all forms I've tried), WMA (both standard and professional including lossless) and PCM WAV. MP3 support covers 8-320kbps (CBR/VBR) up to 48 kHz, and has support for ID3 tag versions 1.0, 1.1, 2.2, 2.3 and 2.4. OGG supports Q1 to Q10, up to 48 kHz for those that still use this silly format. FLAC supports 8, 16 and 24-bit, up to 48 kHz with all (current) tag structures supported. WMA support was unexpected, but it supports Standard 385 kbps/48 kHz. WMA Pro supports 192 kbps/48 kHz. Finally, WAV support is 8/16 bit, up to 48 kHz.
Thumb Drive Support: 64KB or less bytes per sector, formatted FAT16, FAT32 (recommended by Hyundai), exFAT, and NTFS. Yes, I verified it actually reads NTFS. USB hard drives may not be recognized. When using a USB mass storage device divided into logical drives, only the files saved in the first drive can be played. When a USB storage device has some applications, media files may not be detected. Also, it says some USB storage devices with a plastic plugs may not be recognized, but I am successfully using a 32GS MicroSD with a plastic carrier and it works fine. The manual also says that "USB memory cards (e.g. CF cards, SD cards) may not be recognized" but again, I'm using a 32GB MicroSD in a Sandisk plastic USB reader and it works fine.