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I have 2 4g III /30 cards with the 40D and no problems, Is the camera set to only use cards and NOT internal memory, maybe it's is seeing full memory on the internal side and not the card itself. Look at card pins make sure they are all there and not bent or missing. Make sure the internal memory is clear of pictures
What internal memory?
The problem is real and occurs under certain PRECISE circumstances WITH CERTAIN VERSIONS OF THE 4gb CARD.
If you haven't experienced the issue, you are fortunate, it doesn't mean it doesn't exist.