ok.. here's what happened.
i was excited to upload my halloween pictures. i got out the SD card, plugged it in my reader, waited until it can be detected. a few minutes later, still none. i tried to adjust the usb by tightening, loosening it a bit. until i just plug/unplug it. eventually, got the thing running via iphoto. at the end of the file transfer, some pictures failed. i put the memcard back in digicam again.. and got the "File Error" for selected photos.
i was hoping against hope that the images can still be restored since they can still be displayed for a split second before showing "File Error".