Synching Empty Playlists

I have my iPod set to auto-sync with my iTunes. The iTunes has a smart playlist ("Smart") that refers to another playlist ("Other"). After synching, Other is not present on the iPod and Smart has an exclamation point next to it. But Smart seems correctly updated. In iTunes, Other is empty which is the only reason I can come up with as to why Other did not synch with the iPod, causing the exclamation point. It doesn't seem to affect Smart in any way I can detect. However I am curious as to what is happening.