I just wanted to quickly share this SharePoint solution that I found that fixes the bug in SharePoint 2010 when changing the content type of a folder to a Document Set.
The task that I’m faced with is to bring over folders from an existing Document Library in MOSS 2007 and convert them into Document Sets. In an upcoming post I’ll explain the full process to easily automate converting the existing folder into Document Sets.
For some reason when you change the folder with a Document Library to a content type of a Document Set, it does not fully convert it. Below is a link to the solution located in CodePlex which fixes this bug and has worked wonderfully for me.
Project Description
Folder To Document Set Conversion Fix repairs the MS SharePoint 2010 bug where folders are not correctly converted into document sets during a content type property change. This will fix existing problem doc sets on the next update to the doc set properties. This includes a folder icon appearing instead of the doc set icon and the doc set home page unavailability.http://foldertodocsetfix.codeplex.com/

