TheBogueRat - the link looks alright but it seems that you didn't set public sharing to the file on dropbox. I appreciate u keep trying :)
Some good news on my project: I deployed the project to my server and I'm getting much better results. So it looks as there is a Preview on LAN issue involved as well....
The looping is not very precise but it is good enough for my needs.
For future reference, my solution is:
1. Use the Audio folder and NOT the Music folder.
2. Preload, Play and Pause all your audio loops.
3. Play non-looped audio and re-trigger it at end of file.
4. For activating a specified sound use Seek (to sync the new loops to the loops that are already playing) and Resume.
5. For deactivating a sound use Pause.
6. Add a re-sync event: this is a repeating event that sends an identical Seek command to all sounds. This will fix sync problems that may occur due to performance limitations.