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OK, I have updated my android application with android:installLocation="auto" in the manifest. If I install it on my N1 via the USB cable, it works and allows me to move the application to my SD Card.

However, I have a friend that has downloaded the application through the market, and the option is grayed out for him even though it is the same version of the APK. We uninstalled the market version and installed it through the USB cable and he had the option to move the app to the SD Card. We uninstalled and reinstalled the market version, and again it was grayed out.

Any ideas?

A: 

Actually, after digging, I found the issue. I have the app "Copy Protected" which prevents it from being moved to the SD Card.

http://android-developers.blogspot.com/2010/07/apps-on-sd-card-details.html

Steve0212