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I've installed VirtualBox 6.1.16.14 and VM VirtualBox Extension Pack.
The extension pack shows installed when I check settings.
My guest OS is windows 7 ultimate 32bit. Install of the guest worked fine and it operates fine.

When I try to share files between the host and guest the share never shows in the guest windows explorer and I get an error message that the extension pack is not active.
If I try to attach a usb drive it also fails with a similar error message that the extension pack is not active.
when I try insert extension pack CD that does nothing.

Since VMbox shows the extension pack has been installed what can be wrong?
thanks in advance

Are you confusing the extension pack and the guest additions? Shared folders requires that the guest additions be installed in the guest. The extension pack, which is required for usb2/3, is installed on the host.

The install guest additions on the devices pulldown down does not do anything. No autoplay window appears to choose the guest additions iso.

Autoplay of inserted CDs is an OS thing not a Virtualbox thing. Modern OS's have deprecated autoplay of CDs for years. At most the OS might ask what is to be done with the CD, and that can be turned off too.

Go to your VM's CD drive and run the installer manually.

Guest additions is an iso file.
How will using the guest CD reader allow the VM to recognize it?

Because it was designed to do just that. The optical drive of the vm, like the other vm devices, is an emulation of a physical device. It emulates a CD/DVD reader. If you assign an iso file to that drive it will read it as if it was a CD. An iso contains exactly the same information as the corresponding physical CD. It is simply a CD image file. You can burn a physical CD from an iso using software. Windows 10 will do it directly by right-clicking the iso file and selecting the Burn disk image option.

If you only had the physical CD, you would need to put it in the host's physical CD drive and tell VirtualBox to use this as the input.

thanks everyone, shared folders working now after installing guest additions into guest