This error has been popping up on enough brands of sleeve (Compaq, Nexian, MemPlug) and with enough different cards (e.g., storage, networking, etc.) that I'm really beginning to think it's a Compaq software issue.
See:
http://discussion.brighthand.com/sho...hlight=memplug
http://discussion.brighthand.com/sho...hlight=memplug
http://www.pocketpcpassion.com/forum...hlight=memplug
http://www.pocketpcpassion.com/forum...hlight=memplug
http://www.pocketpcpassion.com/forum...hlight=memplug
REALLY sounds like the iPAQ has trouble with 2 CF slots...