Natty v. 2.6.35-28-generic -Can't gain permission to create folders in external hard drive

Log a regression bug is all I can advise, maybe others can advise

This external drive is formated FAT32, NTFS or ext4 ?
Did you an upgrade from update-manager ?

Fat32 upgraded through update manager

Using gksudo nautilus I can create a folder but I can't make the permission permanent and will need to run this command every time. Also when in root the device name does not show- just USB0

delance@delance-desktop:~$ ls -ld /windows
drwxrwx--- 1 root plugdev 8192 2011-03-19 14:29 /windows

Could you command:
  ls -ld <folder on which is mounted external drive>
and post result.

Update-manager is not very reliable. You could download Natty ISO image and install with option "upgrade" which will install system files but keep user files untouched.
There is a new tool also, in System->Administration->Configuration of NTFS I never used.

Downloaded the Natty latest ISO and created a CD and USB - can't get past the initial screen using a CD or stick - getting a kernel panic screen indicating some kind of synching issue.

Could you provide exact error message, so I could have a look at Google.

OK hope this helps - the first line is:

1.597109] kernel panic- not syncing: VFS:unable to mount root fs on unknown block (8.1)

Could you check both ISO image: https://help.ubuntu.com/community/HowToMD5SUM .
Check also you were really booting on external device.
This message means you can't mount the partition which contains main Ubuntu folder "/".

e0a086f4c245304c19b281b8e5af8928 (my system)
8b1085bed498b82ef1485ef19074c281 ubuntu-11.04-desktop-i386.iso

As you can see, as you suspected they don't match.

will download iso again and report.

Please download the iso image using torrent protocol to get best error download error check during download

Problem Solved

Using the Natty ISO which I burnt to DVD (rather than CD) I could hear the PC going through the installation motions without seeing the screen (this went blank after selecting "install Ubuntu" option.

I disconnected the HDMI connection and reverted to the DVI output (which is connected to the RGB input of the TV monitor via a VGA cable with VGA-to-DVI adapter. Due to the DVI, I have needed to use external speakers for audio, but Nautilus is back and fully functioning. All my folders on my external hard drives are fully accessible a again - but do you know what - I preferred my HDMI arrangement.

The issue must have been related to the HDMI connection to tv/monitor with the Dell Studio Hybrid.

Ps Natty torrent iso used as advised.