I'm sure this answer is out here but I can't find it. I have my music library stored on my PC and most of that same music stored on my Android smartphone (RazrMaxxHD). Spotify is asking me to "download" playlists that already exist on my Android phone.
What I want is for Spotify to recognize the music stored on EACH device (including my limited ram Kindle Tablet) and allow me to download playlists TO THAT DEVICE as I choose. (I don't need Christmas music on my tablet all year long and it would take up too much space)
Spotify only works with local files (files you own such as mp3s etc) which are located on your PC hard drive. These can be downloaded to a mobile device by synching.
The solution would be to make sure all your music is on your PC then delete the mp3 files from your various devices and use spotify to manage your playlists on all devices. The main guides and FAQs are here but shout if you need more help.