Which version of LW are you using?

Have you by any chance changed the location of LW's saved folder? The incomplete folder follows the saved folder... ie if your saved folder was for example C:\Documents and Settings\your name\Shared then your incomplete folder would be C:\Documents and settings\your name\Incomplete.

So, if you have changed your saved folder location then you'd have a new incomplete folder & the old one (containing your old incompletes) may not show up in your library.

That's about the only reason I can think of that you'd be able to find the folder on your HDD & yet it wouldn't show in your library.