Thanks for the feedback guys, The woven rope looks good enough when new, but I don't think its good quality, abrasion resistance-wise, like a rated climbing rope would be. Frankly, I think I've seen the same stuff as cinching chords on cheap duffel bags. I made sure that the rope has not come off the ratcheting pulley. I think the wear is being cause only by the "wedge" mechanism that the rope locks on to. Maybe the manufacturer just made the edges on it too sharp to use on such a rope.
....Maybe it is time to go to REI and get me some better climbing rated, more abrasion resistant rope instead. It won't be cheap, but at least it won't be raining bikes soon in my house!

Chombi