Besdies that I feel a bit uneasy about the 1.4.0_02 Java which I think you should delete (if necessary in Save Mode or by using the CCleaner:
http://www.ccleaner.com/download/(free)), you might have to go to LW>Tools>Options>Speed and look whether "Disable Ultrapeer Capability" is marked. Check also under LW>View>Connections whether you can connect to Ultrapeers.
Last but not least, it can well be that the hosts you're trying to download from are indeed hosts offering faked files. When searching for files I'd recommend to search under "All Types" rather then under Video or Audio. Searching for the artist's name and then trying to browse hosts who have files of this artist might also produce some success.