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Unfortunately, some of the Lite-On series such as the LVW-110x series don't have any folder / track listing, but instead operate like a Hi-Fi where navigation is done in sequence. Assuming the controls on your DVD recoder work like the LVW-1105HC+, the "Menu" and "Top Menu" buttons navigate between folders, while the Next and Previous track buttons navigate between MP3 files in the current folder. If you are interested in displaying the song & folder title on screen for the current playing track, press the 'Navi' button, select 'Information' and set this to 'On'.
I'm quite surprised the Freeview fox is giving issues as you should be able to connect this up as with any other external receiver, such as a satellite receiver, VCR, etc. If your Freeview box has two outputs (TV & VCR), connect the VCR Scart output directly to the Aux (top Scart socket) of your DVD recorder. Connect the TV-out (bottom Scart socket) to your TV. When setting up or preparing to record from your Freview box, press the Source button on your DVD recorder remote to select its Scart input. If your Freeview box has only one output (TV), connect this to your DVD recorder's aux (top Scart socket) and follow the steps for the Canal+ decoder supplement.
As far as I'm aware of, Lite-On has not released any firmware update that displays the folder listing on the Lite-On LVW-110x series, so I don't think there would be any such firmware update for your model. However, it will be worth trying a new firmware update in case.