Solved my own problem, so I figured I'd share it with others.
version 0.3.6 would not run on USB-HD. v0.3.7 was on my SD card and worked. So I used the browser to DL WIIXplorer to copy v0.3.7 from SD to HD. It now works!
PS: I'm disappointed, I had over 60 views in two threads on this subject w/o a reply.