diff --git a/docs/design/crate-classification.md b/docs/design/crate-classification.md
index e8f0d38..d6446a0 100644
--- a/docs/design/crate-classification.md
+++ b/docs/design/crate-classification.md
@@ -9,10 +9,15 @@ broken manual references or given the same health-score weight.
 ## Architecture
 
 Crates carry a `static`, `smart`, or `unknown` kind. Folder provenance is the
-primary signal: Serato stores regular definitions in `Subcrates` and smart
-definitions in `Smartcrates`. `Compatible by key.crate` is also treated as smart
+primary signal: Serato stores regular `.crate` files in `Subcrates` and smart
+`.scrate` definitions in `SmartCrates`. `Compatible by key.crate` is also treated as smart
 when encountered in `Subcrates`, based on the original migration case study.
 
+Smart crate names use `≫≫` to encode hierarchy. The model preserves those segments,
+so `Compatible by key≫≫10A.scrate` has a parent of `Compatible by key` and a display
+name of `10A`. Smart definitions and dynamic `.crate` containers are counted
+separately.
+
 The library loader reads both folders. Health analysis reports all references but
 scores only non-smart references. Unknown crates remain scoreable so incomplete
 classification cannot silently hide potential problems.
diff --git a/docs/design/smart-crate-discovery.md b/docs/design/smart-crate-discovery.md
new file mode 100644
index 0000000..ed553ba
--- /dev/null
+++ b/docs/design/smart-crate-discovery.md
@@ -0,0 +1,19 @@
+# Smart Crate Discovery Correction
+
+## Problem
+
+The first classifier searched `SmartCrates` for `*.crate`. Real Serato smart-crate
+definitions use `.scrate`, so a library with 26 definitions displayed only the
+single name-based `Compatible by key.crate` fallback.
+
+## Correction
+
+Library discovery now reads `.scrate` definitions case-insensitively from the
+`SmartCrates` folder. Dynamic `.crate` containers remain excluded from manual
+reference scoring but are reported separately. The `≫≫` filename separator is
+preserved as smart-crate hierarchy metadata.
+
+## Verification
+
+Synthetic tests cover `.scrate` discovery, case-correct folder names, hierarchy,
+definition/container counts, and the existing five-static/two-smart sample.
diff --git a/samples/small-library/generate.py b/samples/small-library/generate.py
index 84fa290..ae13268 100644
--- a/samples/small-library/generate.py
+++ b/samples/small-library/generate.py
@@ -28,18 +28,28 @@ def build_sample(output: Optional[Path] = None) -> Path:
         )
 
     for crate in manifest["crates"]:
-        folder_name = "Smartcrates" if crate["type"] == "smart" else "Subcrates"
+        is_smart = crate["type"] == "smart"
+        folder_name = "SmartCrates" if is_smart else "Subcrates"
         crate_root = serato_root / folder_name
         crate_root.mkdir(parents=True, exist_ok=True)
-        other_folder = "Subcrates" if folder_name == "Smartcrates" else "Smartcrates"
-        stale_path = serato_root / other_folder / crate["name"]
-        if stale_path.exists():
-            stale_path.unlink()
+        output_name = (
+            Path(crate["name"]).with_suffix(".scrate").name
+            if is_smart
+            else crate["name"]
+        )
+        for other_folder in ("Subcrates", "Smartcrates", "SmartCrates"):
+            for stale_name in (
+                crate["name"],
+                Path(crate["name"]).with_suffix(".scrate").name,
+            ):
+                stale_path = serato_root / other_folder / stale_name
+                if stale_path.exists() and stale_path != crate_root / output_name:
+                    stale_path.unlink()
         records = "".join(
             f"{SERATO_PATH_PREFIX}{relative_path}otrk"
             for relative_path in crate["references"]
         )
-        (crate_root / crate["name"]).write_bytes(records.encode("utf-16-le"))
+        (crate_root / output_name).write_bytes(records.encode("utf-16-le"))
 
     return root
 
diff --git a/serato_doctor/cli.py b/serato_doctor/cli.py
index 0ccdd35..435f37f 100644
--- a/serato_doctor/cli.py
+++ b/serato_doctor/cli.py
@@ -95,6 +95,7 @@ def main():
         print(f"Broken Symlinks: {health.broken_symlinks}")
         print(f"Static Crates: {health.static_crates}")
         print(f"Smart Crates: {health.smart_crates}")
+        print(f"Smart Crate Containers: {health.smart_crate_containers}")
         print(
             f"Dynamic References Excluded: {health.dynamic_references_excluded}"
         )
diff --git a/serato_doctor/crate_parser.py b/serato_doctor/crate_parser.py
index c8327a7..be0abda 100644
--- a/serato_doctor/crate_parser.py
+++ b/serato_doctor/crate_parser.py
@@ -103,9 +103,19 @@ def load_library_crates(
     serato_root: Path, reference_roots: Iterable[Path] = ()
 ) -> Tuple[Crate, ...]:
     reference_roots = tuple(reference_roots)
+    if not serato_root.is_dir():
+        return ()
+
     crates = []
-    for folder_name in ("Subcrates", "Smartcrates"):
-        folder = serato_root / folder_name
-        for crate_path in folder.rglob("*.crate"):
-            crates.append(load_crate(crate_path, reference_roots))
+    folder_patterns = {
+        "subcrates": ("*.crate",),
+        "smartcrates": ("*.scrate", "*.crate"),
+    }
+    for folder in serato_root.iterdir():
+        patterns = folder_patterns.get(folder.name.casefold())
+        if patterns is None or not folder.is_dir():
+            continue
+        for pattern in patterns:
+            for crate_path in folder.rglob(pattern):
+                crates.append(load_crate(crate_path, reference_roots))
     return tuple(sorted(crates, key=lambda crate: str(crate.path)))
diff --git a/serato_doctor/health.py b/serato_doctor/health.py
index c1cca6f..2cf4169 100644
--- a/serato_doctor/health.py
+++ b/serato_doctor/health.py
@@ -67,7 +67,12 @@ def analyze_health(library: Library) -> HealthReport:
             crate.kind is CrateKind.STATIC for crate in library.crates
         ),
         smart_crates=sum(
-            crate.kind is CrateKind.SMART for crate in library.crates
+            crate.kind is CrateKind.SMART and crate.is_smart_definition
+            for crate in library.crates
+        ),
+        smart_crate_containers=sum(
+            crate.kind is CrateKind.SMART and not crate.is_smart_definition
+            for crate in library.crates
         ),
         unknown_crates=sum(
             crate.kind is CrateKind.UNKNOWN for crate in library.crates
diff --git a/serato_doctor/models/crate.py b/serato_doctor/models/crate.py
index 58a4789..f0906a3 100644
--- a/serato_doctor/models/crate.py
+++ b/serato_doctor/models/crate.py
@@ -19,3 +19,15 @@ class Crate:
     path: Path
     references: Tuple[TrackReference, ...]
     kind: CrateKind = CrateKind.UNKNOWN
+
+    @property
+    def hierarchy(self) -> Tuple[str, ...]:
+        return tuple(self.path.stem.split("≫≫"))
+
+    @property
+    def display_name(self) -> str:
+        return self.hierarchy[-1]
+
+    @property
+    def is_smart_definition(self) -> bool:
+        return self.path.suffix.casefold() == ".scrate"
diff --git a/serato_doctor/models/health.py b/serato_doctor/models/health.py
index 8d0bed5..00fa3ab 100644
--- a/serato_doctor/models/health.py
+++ b/serato_doctor/models/health.py
@@ -22,6 +22,7 @@ class HealthReport:
     broken_symlinks: int
     static_crates: int
     smart_crates: int
+    smart_crate_containers: int
     unknown_crates: int
     dynamic_references_excluded: int
 
diff --git a/serato_doctor/webui/index.html b/serato_doctor/webui/index.html
index 8c69585..96df962 100644
--- a/serato_doctor/webui/index.html
+++ b/serato_doctor/webui/index.html
@@ -73,7 +73,7 @@
         <div id="diagnostics" class="diagnostics panel">
           <div class="section-heading"><div><p class="eyebrow">Full picture</p><h2>Diagnostics</h2></div><span class="read-only-tag">No changes made</span></div>
           <div class="diagnostic-list">
-            <div><span class="diag-icon violet">◇</span><p><strong>Crates</strong><small><b data-field="static_crates">—</b> static · <b data-field="smart_crates">—</b> smart · <b data-field="dynamic_references_excluded">—</b> dynamic references excluded</small></p></div>
+            <div><span class="diag-icon violet">◇</span><p><strong>Crates</strong><small><b data-field="static_crates">—</b> static · <b data-field="smart_crates">—</b> smart · <b data-field="smart_crate_containers">—</b> dynamic containers · <b data-field="dynamic_references_excluded">—</b> references excluded</small></p></div>
             <div><span class="diag-icon amber">≋</span><p><strong>Duplicate filenames</strong><small><b data-field="duplicate_filename_groups">—</b> exact groups · <b data-field="duplicate_files">—</b> extra files</small></p></div>
             <div><span class="diag-icon blue">⌁</span><p><strong>Cloud conflicts</strong><small><b data-field="suspected_cloud_conflict_groups">—</b> suspected groups · <b data-field="suspected_cloud_conflict_files">—</b> extra files</small></p></div>
             <div><span class="diag-icon red">↗</span><p><strong>Broken symlinks</strong><small><b data-field="broken_symlinks">—</b> unresolved links</small></p></div>
diff --git a/tests/test_crates.py b/tests/test_crates.py
index 0c7b046..12441ed 100644
--- a/tests/test_crates.py
+++ b/tests/test_crates.py
@@ -6,6 +6,7 @@ from serato_doctor.crate_parser import (
     classify_crate,
     clean_path,
     load_crate,
+    load_library_crates,
     parse_crate,
     parse_crates,
     path_markers,
@@ -92,7 +93,7 @@ def test_parse_crates_reuses_configured_roots_for_every_crate(tmp_path):
     ("relative_path", "expected"),
     [
         ("_Serato_/Subcrates/House.crate", CrateKind.STATIC),
-        ("_Serato_/Smartcrates/Warmup.crate", CrateKind.SMART),
+        ("_Serato_/SmartCrates/Warmup.scrate", CrateKind.SMART),
         ("_Serato_/Subcrates/Compatible by key.crate", CrateKind.SMART),
         ("fixtures/Unknown.crate", CrateKind.UNKNOWN),
     ],
@@ -101,3 +102,35 @@ def test_classify_crate_uses_provenance_and_known_dynamic_name(
     tmp_path, relative_path, expected
 ):
     assert classify_crate(tmp_path / relative_path) is expected
+
+
+def test_smart_crate_preserves_encoded_hierarchy(tmp_path):
+    crate_path = (
+        tmp_path / "_Serato_" / "SmartCrates" / "Compatible by key≫≫10A.scrate"
+    )
+    crate_path.parent.mkdir(parents=True)
+    crate_path.write_bytes(b"")
+    crate = load_crate(crate_path)
+
+    assert crate.kind is CrateKind.SMART
+    assert crate.hierarchy == ("Compatible by key", "10A")
+    assert crate.display_name == "10A"
+    assert crate.is_smart_definition
+
+
+def test_load_library_crates_discovers_scrate_definitions(tmp_path):
+    smart_folder = tmp_path / "SmartCrates"
+    static_folder = tmp_path / "Subcrates"
+    smart_folder.mkdir()
+    static_folder.mkdir()
+    (smart_folder / "New EDM.scrate").write_bytes(b"")
+    (smart_folder / "Re-Drums.scrate").write_bytes(b"")
+    (static_folder / "House.crate").write_bytes(b"")
+
+    crates = load_library_crates(tmp_path)
+
+    assert [(crate.path.name, crate.kind) for crate in crates] == [
+        ("New EDM.scrate", CrateKind.SMART),
+        ("Re-Drums.scrate", CrateKind.SMART),
+        ("House.crate", CrateKind.STATIC),
+    ]
diff --git a/tests/test_health.py b/tests/test_health.py
index 2ebf242..28ea77e 100644
--- a/tests/test_health.py
+++ b/tests/test_health.py
@@ -63,14 +63,14 @@ def test_empty_library_has_no_health_score():
 def test_smart_crate_references_are_reported_but_not_scored():
     static_reference = reference("Found.mp3")
     smart_reference = TrackReference(
-        Path("Smartcrates/Dynamic.crate"),
+        Path("SmartCrates/Dynamic.scrate"),
         Path("/old/House/Dynamic.mp3"),
         "Dynamic.mp3",
     )
     crates = [
         Crate(Path("Subcrates/Static.crate"), (static_reference,), CrateKind.STATIC),
         Crate(
-            Path("Smartcrates/Dynamic.crate"),
+            Path("SmartCrates/Dynamic.scrate"),
             (smart_reference,),
             CrateKind.SMART,
         ),
@@ -85,6 +85,7 @@ def test_smart_crate_references_are_reported_but_not_scored():
     assert report.missing_references == 0
     assert report.static_crates == 1
     assert report.smart_crates == 1
+    assert report.smart_crate_containers == 0
     assert report.dynamic_references_excluded == 1
 
 
diff --git a/tests/test_sample_library.py b/tests/test_sample_library.py
index d2b583c..58c3cb8 100644
--- a/tests/test_sample_library.py
+++ b/tests/test_sample_library.py
@@ -24,7 +24,9 @@ def test_generated_sample_library_has_expected_scenario(tmp_path):
         if not result.exists_by_filename
     }
 
-    assert len(list((sample_root / "Serato").rglob("*.crate"))) == 7
+    crate_files = list((sample_root / "Serato").rglob("*.crate"))
+    smart_files = list((sample_root / "Serato").rglob("*.scrate"))
+    assert len(crate_files) + len(smart_files) == 7
     assert len(library.references) == 13
     assert len(tracks) == 10
     assert missing == {"Missing.mp3", "Old Name.mp3"}