was manually managing music and suddenly music already on device "could not be synced"

I was manually managing my music the same way I usually do and dragging and dropping some new music onto my iphone and noticed it was taking longer than usual. I opened up my music app and suddenly all other songs by the same artist I was currently attempting to add were greyed out with a red icon similar to the one that appears on the app store. Then out the blue, the icon appeared next to all existing music in my library. Finally, I got a message letting me know that "2445 items could not be synced". So now I'm only left with the new music I added and lost over 30GB of existing music and playlists.

Searching through the apple community, I have very little hope of recovering my music as it is no longer on my device. Ok, I accept that. Fortunately I have all my original music files backed up on various external hard drives. If by some miracle I can still recover my music then cool. All I really want to know is why this happened in the first place. I have itunes set to allow me to manually manage my music and have been dragging and dropping for some time now without any problems.

I am currently at work and away from my home computer so I can't give too much information at the present moment regarding itunes version etc. But a few things that I did notice is that if I disconnect/reconnect my device, my original library appears in itunes but, itunes can't find the files if I try to play them. I tried to restore from a backup and I got a message saying that I couldn't backup from that computer, even though its the computer I registered and had been using the whole time.

I am using an iphone 5s 64GB, ios version 7.0.4(11B554a). I still have all my apps and photos intact as well.

Thanks to the community in advance