Guy Burns wrote:
a small red dash appears in User folders
You can only access the folders which the user account you used to log in to the remote Mac is allowed to access. The icon says this account does not have the permission to read the folder you're trying to read. If this worked with the previous OS version, it means you had custom permissions, which were re-set when you upgraded the OS.
how on earth did it know
It's a new function introduced in Snow Leopard. It's called ESP (extra sensorial perception, or mind-reading).