Windows 7 will not automount (assign a letter) a flash drive, behaves really strange

The Windows disk manager can corrupt the partition table, try using Gparted to create a new partition table and a primary fat32 partition with no flags.

I ran into the same problem and experienced the same set of symptoms as you.

I eventually resolved this problem by using a third party partition tool to do the following:

1. Wipe all partitions on the flash drive.
2. Create a new FAT32 partition encompassing the whole flash drive.
3. Manually set the drive letter.

In my case, I used the free download MiniTool Partition Wizard Home Edition.

Worked like a charm. No reboot required.

Best of luck!