-it's possible to have multiple ini files, priority is: USB, HDD, BB MU, FLASH
(** it is NOT recommended to launch USB con/xex from hdd ini **)
the first one found on the devices in that order will be the one used.
-see
http://code.jellycan.com/simpleini/ for more info on the ini parser
-if you find your ini file is not working, open it in a hex editor and ensure
that windows didn't convert it to a non-ASCII format by putting identifyer
bytes at the beginning of the file. The first charater in a hex editor
should be whatever the first character you have in the ini file, not
non-character codes like 0xFF or similar
Now try this make a ini with the path pointing towards your FSD and then copy it to a usb drive and see if that works. I would leave the one in flash alone as its more or less a fail safe and since its the very last spot dashlaunch will look for a launch.ini it will not affect any other ini.
Also if you have another Ini either on a hdd, internal MU or USB that points to a bogus location it will stop dashlaunch from using the INI in flash so you might wanna see if thats an issue also