When the $Library directive is parsed (triggered when the line is changed) the specified library is loaded and the exported items are added to the Imports tab in the sidebar. When the file is indeed located and opened a message of success is written to Debug Output Window saying "Loading lg32filename".
Any errors caused by the $Library are then due to a corrupt lg32 file.
The "Load lg32 error" message
Programs that contain references to libraries using the $Library directive may occasionally show a "Load lg32 error: filename.lg32" in the status bar. This message is generated when the specified library can't be located at the specified path or, when a path is omitted, in the current active directory, 'My Documents\lg32', or in directories that are searched using the SearchPath API function.
This message should therefore be called: "Lg32 file not found".
Reload project to reset current directory
When a lg32 can't be found the most obvious reason is an unexpected active directory. Sometimes when working at a project the active directory is changed and the project's directory isn't the current any longer. To check for this, simply reload the project, because this sets the current active directory back to the project's folder.
Set default path for Libraries
An undocumented feature is the possibility to set a default path for libraries in the registry. The registry key HKEY_CURRENT_USER\Software\GFA\Basic must contain the key "lg32Path" specifying the default path for the libraries. The key is not present at default, so you must add the key yourself.
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