I've been using Live Mesh to sync my music collection between several of my PCs. Recently I noticed that duplicates were appearing in my music library. I found the culprit was a Live mesh folder:
C:\Documents and Settings\UserFolder\Local Settings\Application Data\Microsoft\Live Mesh\GacBase\HoldingArea
With WMP 11 I removed the folder via "Category:Music > Library > Folder". I went with the "Delete from library only" option when prompted.