Hi Ribby
I don't really understand your question. The include() function is there to allow you to include code/data from another file in your script. Thus you can include classes and functions stored elsewhere without having to paste them into your script every time.
You can't include an entire folder of files. All your code does is include the string "http://mysite.com/files" in your PHP code. Thus I don't understand what you mean when you say "it shows up fine". What shows up and where?
If you want to create links to a whole folder of files, you'll need to create and array of the file names and then iterate through the array adding the anchor tags to each one ... or something like that.
Explain what it is you're trying to do and perhaps the answer will be forthcoming.
Norman