A bit more info. I think the problem is in the scanning of the XML file. I just tried accessing the firefly server from another mac running iTunes 6.0.4, and it does not display the playlists either. This tells me it’s not a protocol problem, but a scanning problem.
Also, if I check the “smart playlists” pane in the firefly web interface, it is not showing the playlists there either. It was displaying them before the upgrade to iTunes 6.0.5. (My “iTunes Music Library.xml” file is being generated by the iTunes 6.0.5 machine.