Understanding Syncing/Streaming/Combo of 2.0 - HELP!

Hi all,
An 40 GB AppleTV upgraded to 2.0. All library items are coming from my iMac. After upgrading on the day of the release of 2.0 I was able to seamlessly access all of my iMac content - even though some were synced and other were obviously streamed. (like my 85 movies were obviously NOT synced)
Had a Power Failure today and then my iMac library was grayed out on the ATV and the ATV was missing from my iTunes. After MANY attempts to get them to see each other, I reset the whole works and now I am not back to my original easy config. When selecting the sync option setting up ATV, a lot of my iTunes content is simply missing on ATV. If I decide to stream instead, then I have to use the Sahred Library selection in ATv instead of the various My Library entries.
What happened here? Am I missing a setting? Is it not true that the ATV should sync and then stream the un-synced items?
Help!!!
Stu

Meme - no, that box was not selected.
Winston - only one library.
I have now fixed this by doing a factory restore, upgrading to 2.0 and then setting up the iMac library once again. Now, it all works as it did before.
For the life of me, I am not sure why this was not easier. Even though my iMac library was grayed out after the power failure, the Apple TV seemed to offer me the option of selecting it, removing it from the ATV and then re-selecting it for syncing. However, after reselecting, typing the code in iTunes and letting it sync (40 minutes), the entry on ATV was STILL grayed out and my items were still not streaming - only the synced content would appear.
I'd like to say this "solved the problem", but I really don't feel this is a viable solution.
Thanks to you for your help! Much appreciated.

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