I don't know, but suggest that you file a bug report. I just tested a download here from my Mesh folders and it worked fine.
Since you can navigate via Live Desktop, just not the mobile version, and it affects the phone plus one or more PCs, it isn't a problem on the device side, in my opinion.
I don't know if submitting logs would be important for this one, but it wouldn't hurt.
How to Submit Bugs and Live Mesh Logs
-steve
Microsoft MVP Windows Live / Windows Live OneCare & Live Mesh Forum Moderator