Can't sideload books onto Kobo Aura One

I just got my Aura One. The first thing I did was to download a book with Overdrive. That went well. I installed the latest version of Calibre on a Windows 7 laptop and copied my entire Calibre library to it from my XP computer. The latest version of Calibre doesn't work on XP, and the Aura One doesn't work with the version of Calibre installed on my XP machine. Anyway, I plug in my Aura One and use Calibre to put a book on it. It shows the book on the device and I can see the book is in the root directory of the reader. When I eject the reader (through "My Computer", not Calibre) the reader may or may not go through the updating process. If it doesn't, then obviously the book isn't in my library, but if it does then it says there's a problem and it can't open the document. I have the Kobo Touch Extended plugin installed and Calibre is converting the epubs to kepubs before transferring. I also have the Kepub Output plugin and some books in my Calibre library are both epub and kepub. Whether or not the reader updates after ejecting doesn't matter if the book has just an epub format or both. Also, after using Calibre, the book I borrowed from Overdrive 3 days ago disappeared. I turned the reader off and back on and the book showed back up, but now it said it was expired. You get them for 2 weeks. Good thing I finished it before all of this. I should mention that I also have a Glo HD and while using Calibre on my XP machine everything works flawlessly, so it isn't my books. I've also tried manually adding books to the root directory (that's where Calibre puts them, and there's already another author folder there with a kepub book in it). I've tried both making a folder and putting just a plain epub version both in the folder and in the root directory itself. I've tried this on both computers and nothing happens. No updating, and no books.

Powering off and on doesn't do anything and I've already done one factory reset. It cost too much money to not be able to use it. Anyone have any ideas before I send it back?

Thanks.