For starters, I think the idea of genres is stupid to begin with. If your music is so bland and predictable that you can throw a label on it and group it together with thousands of other artists why are you listening to it. I do like to use genres when I organize my music instead of making playlists. As an example, if I'm in the mood to listen to Pixies, I probably won't mind if you mix in some of The Clash as well. More mellow bands like Iona would more than likely not be welcome in this group.
So a huge problem I have is that a very large majority of the music I listen to is soundtracks from video games. Soundtrack is not a genre, its not a musical style. Its the medium that the music was presented in. Now if your only thinking of music you've heard in movies or some of the more epic games, then you probably think all of it sounds the same. I gonna bet that if you're reading my blog, you probably know that it doesn't all sound like that, not by a long shot.
The problem that I run into is that I want to assign genres to music I listen to for organizational purposes but with the exception of a few artists, they all vary their style so much that its difficult to look at an artist and put all their music in one genre. Not only that, but some of the albums have different genres inside the album itself making me wonder if I should go all out and hand pick the genre for each song. A perfect example is Granado Espada which goes between classical and electronic with a few pop and celtic songs in there just to really throw you off. With more normal music I can simply look up on wikipedia or last.fm what genres other people have associated with an artist and its usually in line with other things I have listed in that category. But thanks to "Soundtrack" being considered a legitimate genre, this doesn't work with 80% of my music.
Since we're on the topic of genres, I hate it so much when I ask someone what kind of music they listen to and they name one genre... and then stop. Typically this happens with people who listen to some form of electronic, but no matter what genre you say I think its pretty bad if your taste in music is that limited.