Well you're missing a closing ) in this line - the A() is closed but the LI( 
is not:
{{  myli = LI(A(myrow['strRegionNameRendered'], _href="#") }} 

Why not simplify your template down a bit - Having your LI's inside a DIV 
seems a bit odd.

{{myUL = UL(_id="dhtmlgoodies_tree", _class="dhtmlgoodies_tree")}}
{{for row in sortedfolderlist:}} 
    {{myrow = row[1]}} 
    {{myUL.append(A(myrow['strRegionNameRendered'], _href="#")) }} 
{{pass}} 
{{=myUL}}

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