We found out interesting problem today. It is easy to repeat, so I'm in hurry to provide workaround until there is fix in the application. The problem appears on a specific configuration of OneNote that is easy to do by mistake. This configuration is incorrect and should be fixed by a user.
In OneNote, it possible to open any windows folder as a notebook. If there are notebooks inside the folder you are opened, they will be shown as Section Groups, both of them (Notebooks and Section Groups) are represented as windows folders on a hard drive.
It seems to be incorrect that a user can open a notebook as a section group and there is no restriction on this in OneNote, but I must admit this flexibility can be useful (when you have many notebooks you can open them all at once, as one notebook).
Anyway, this is not the main problem. The real problem is that it is possible to open Default Notebook Location folder as a notebook in OneNote. When you do this, you cannot create new local notebooks in OneNote anymore, as it will try to create them inside an Notebook that is already open.
Currently MobileNoter just do not sync Quick Notes in a such configuration. We will handle this in future versions by adding dialog that will ask for another location for new Notebook for Quick Notes.
There are two ways to resolve a problem until there is the fix in MobileNoter:
1) Change Default Notebook Location in OneNote. For example, you can specify a folder that is one level up in the file system if compared with the one that is currently set.
2) Close Notebook that is associated with the windows folder that is the same as Default Notebook Location. And open notebooks that are one level down, one by one.
How to change Default Notebook Location in OneNote:
Tools/Options/Save/Default Notebook Location
File/OneNote/Save&Backup/Default Notebook Location