I have just got my shiny new Samsung Ace and want to music stored on my sd card as a ringtone. When I go to phone ringtone on sound settings, all I can see are ringtones, likewise on notification ringtone.
I have s2, but should be similar. Set it through your music app, not phone settings. Open your music files, select your track you want for ring tone and in menu options you should be able to choose set as ringtone