Sure, and I discuss that exact issue in the Troubleshooting section of the User's Guide. There are definitely cases where you can have a source and destination that can't be reconciled, especially if you're dealing with large (14GB) files and the drive is close to full.
If you know what large file you moved/deleted/whatever, you can manually go into the destination and delete it. Then, empty your trash, and the smart update will work.
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--Dave Nanian
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