I've just made the test, with a folder named "Movies" and another named "Movies - Seen"... And there was no problem...
Could you please try again, because I suspect that you've selected "D:\" instead of selecting "D:\Movies\".
By the way, it's not a good idea to have a separate folder for the movies you've seen, and to move the file into that folder after you've watched a movie. Well, maybe it used to be a good solution, but if you start using Coollector, it'll be much better to rate the movies that you've seen.http://www.coollector.com/help.html#movies
This way, you won't have to move any file and scan the folders again. Also, an icon with your rating will appear next to the movie, instantly reminding you that you've seen it and how much you've liked it. And finally,you'll get movie recommendations based on your taste!
Tip: to start off rating the movies that you've seen (even those you don't own), the most convenient method is to use the menu "Tools->Play the rating game".