Actually, 'Start.prc' in the \PALM directory is run. This can be stopped
by applications on the device that intercept the notification and tell
the OS that it is handled. See here:
http://news.palmos.com/read/messages?id=183651

 
> > The act of inserting a memory card does not, to my knowledge,
> > automatically cause the execution of any code on that memory card.
> > Again, please correct me if I am wrong.
> 
> I honestly don't know - I haven't researched this subject yet. I know
that
> on card insertion, some code is executed on the Palm. Whether the card
> itself can have any "autostart" program - I don't know yet.
> 
> But the reason why I mentioned it, is because it is a data entry
point.
> The contents of the card might contain virus-infected applications.
Even
> if the virus there can't execute until you launch one of these
> applications, it still means that a virus can enter your PDA this way.
> And, once the virus is in your PDA, it could intercept memory card
> insertion and infect all the applications that reside there.




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