First thing you should do when you can’t find anything: check the log file.
Usually found at /var/log/mt-daapd.log. Also, when the log file doesnt specify enough details, in the conf file — /etc/mt-daapd.conf — you can specify the debuglevel up to level 9 to get more details.
When this doesnt help you out, try posting a bunch of the final lines of the log file here, so we can have a look.
Also: if it gives an error on the homedir, you could try /home/user/.gvfs/Music instead of ~/.gvfs/Music. If not, it was worth a try. 🙂