It is pretty annoying that ms has had nearly a year to fix some of these problems, but seems unwilling/unable to do so. Gdr2 supposedly fixes the issue but I've not noticed any difference.
I think you just need to change the extension of the playlist files and move them across to wmp's playlist folder. Zune playlist files are .zpl and wmp playlists are .wpl. There are a few guides if you search. Not sure about Xbox music as I don't use it, but I think you can only stream for free...
Tbh I ditched the app and just use wmp to sync my music and playlists. Works a lot better as long as you don't have a music pass, but still far from perfect. Hopefully MS are busy working on a proper solution to the multitude of issues people are having.
I am having a similar issue with album names and playlists disappearing every few days. In wmp the albums show correctly for the phone, and a resync fixes it temporarily. FYI I don't have an Xbox music pass, and music is stored on an SD card.
Yet another infuriating problem with music on wp8!
Not seen that error before, try this-
Uninstall with revo and remove all traces of the program
Download and run ccleaner (the registry fixer part)
Reboot and try installing again
If it still won't run try running it as an administrator.
Sometimes traces of the program remain when you uninstall. download and run revo uninstaller to remove all traces of the program, including registry entries, and try to install again. Worked for me, but be careful as it will alter the registry.