It would be a grand undertaking and, although I'm not an expert on the hardware or software that's running the empeg, I think I can explain a little bit.
The main issue is that, while the emptool source does have code for talking to the empeg over serial, ethernet or USB, it's specifically about talking to the player software that's listening on one of those interfaces. It's documented (in source form) how to talk to the empeg over the wire, but the code is all built around talking to the player software to transfer music files back and forth. If you wanted to use the same codebase to transfer arbitrary files, you'd only be able to use the lowest-level code there was for physically communicating over the USB interface and then re-implement your own protocol on both the PC and the empeg side of things for actually doing the data transfer. (i.e. you'd have to write an ftp server that understood how to talk to the usb device on the empeg.)
It certainly should be do-able on both sides, but it would be quite a hack-job at trying to write an FTP client for Windows and server for the empeg that knew how to talk across the USB devices instead of sockets. (Probably much easier on the empeg side of things since Linux presents its devices is a much more consistent fashion, I believe.)
I don't run Windows to talk to my empeg, so I don't know for sure, but it also could be that the Windows USB empeg driver is specifically designed to talk to the player software and even if you could code your own client from the emptool source, you still might not be able to actually talk to anything on the empeg unless the player software was running, in which case the whole project would be moot unless you also wrote your own USB driver for the empeg for Windows that knew how to talk to your "server."
If you were lucky enough to be running Linux on your client, there is a relatively recent driver that someone has written that will treat an arbitrary USB device as a network device, which makes it butt-simple to establish a PPP session across USB. Some of the iPAQ guys are doing this. It's supposed to work great. You'd have to rebuild the kernel on your empeg to include this driver.
Other alternatives that I see are to a) get a Mk 2 with ethernet and reconfigure your empeg to run inetd and an ftp server or b) install the developer image on your Mk 1 and, using Hyperterm, get a shell prompt on your empeg and establish a ppp session to somewhere to transfer your files. a) works great but is expensive :( and b) would work with your Mk 1 but would be pretty slow.