Take a look at this Microsoft support article:
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Music app playlists are empty when viewed on Windows Phone 8
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"If your playlists contain songs from your computer's personal music collection, create the playlist in the Zune software or create the playlist in Windows Media Player and use the Windows Phone app for desktop to sync the playlist to your phone."
"If your playlists contain Xbox Music songs, get an Xbox Music Pass to play these on your phone."
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So if you are like me and don't use the Microsoft music pass:
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1. Don't use the Windows 8, metro Windows Phone App
2. Don't use XMBOX Music App
3. Install Windows*Phone App for Desktop
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I already had synched with the metro Windows Phone app from my Windows 8 laptop, so I:
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1.* Wiped my phone (settings, about, reset phone), keep in mind this will wipe all data, so if you have anything you need on it then back it up first
2. Went through setup steps on my phone, but did not connect it to my computer
3. Removed the Music metro app (XBOX Music) and metro Windows Phone app
4. Downloaded and Installed the Windows Phone App for desktop
5. Recreated playlists I had deleted in trying to fix this issue by using my zune software and auto playlists, then closed the Zune software.
6. Plugged in my phone to my computer
7. Launched Windows Phone app for desktop
8. Selected the music and playlists I wanted and clicked synch button
9.* Now my playlists are on my phone, but have no songs
10. I clicked sync again and I noticed it still said I had 6 songs to sync, I clicked again a couple times and got down to 3 songs and an error popped up that these 3 songs couldn't be synced.*
11.*I closed the windows phone app
12.* I moved the 3 songs out of my music library to another location ( I used downloads)
13.* I opened the WP 8 desktop app and synched again.* Now it said synching my playlists at the bottom
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I now have all my playlists populated.* It must be the last thing that is synched and the error on the 3 songs prevented it from ever getting to it.