two htaccess files in one website - .htaccess

Question

I created a website in Expression Web and in the website I created a subfolder with my blog which was created in Wordpress. I am not sure if having two different platforms create a problem when crawling my site with Google.
I have two .htaccess files:
one in the root directory which is:
XBitHack on
AddHandler server-parsed .htm
rewriteengine on
rewritecond %{HTTP_HOST} ^mysite.com$
rewriterule ^(.*)$ "http\:\/\/www\.mysite\.com\/$1" [R=301,L] #4d73215aa0571
# -FrontPage-
IndexIgnore .htaccess */.??* *~ *# */HEADER* */README* */_vti*
<Limit GET POST>
order deny,allow
deny from all
allow from all
</Limit>
<Limit PUT DELETE>
order deny,allow
deny from all
</Limit>
AuthName www.mysite.com
AuthUserFile /var/chroot/home/content/i/r/m/irmarie/html/_vti_pvt/service.pwd
AuthGroupFile /var/chroot/home/content/i/r/m/irmarie/html/_vti_pvt/service.grp
Options +FollowSymLinks
rewritecond %{HTTP_HOST} ^mysite\.com$ [NC]
rewriterule ^(.*)$ http://www.mysite.com/$1 [R=301,L]
One .htaccess file in the subfolder of my wordpress blog.
Which is:
# BEGIN WordPress
<IfModule mod_rewrite.c>
RewriteEngine On
RewriteBase /blog/
RewriteRule ^index\.php$ - [L]
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /blog/index.php [L]
</IfModule>
# END WordPress
In my site I have many subfolders such as:
folder_a
folder_b
folder_c
When checking my Google crawl stats it looks like Google is looping and creating pages that look like this:
root/folder_a/folder_b/folder_c/folder_d.htm
and adding an htm extension at the end and showing as a 404 page.
This goes on and on in a never ending loop and therefore googlebot stops crawling the rest of my site.
I will appreciate if someone could help me in solving this issue.
Thanks