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Apple File Exchange is a utility included on the TidBITS disk or Install 2 disk in system versions 7.0 through 7.1. In System 7.5, it was replaced by PC Exchange.
Apple File Exchange could read floppy disks from Macs, as well as disks from DOS/Windows and ProDOS (Apple II) systems.
This utility enabled Macs to read PC disks -- but not without a trick: the diskette must have been inserted after Apple File Exchange was open! If this was not the case, the Mac would complain that the disk inserted "was not a Macintosh disk" and requested initialisation.
AFE Bugs
A high-density diskette in DOS format formatted as a 720K disk will not function correctly; the Mac assumes that any high-density disk has been formatted as an HD disk. To solve this problem, cover the square hole with a piece of tape opposite the write-protect tab and re-insert the disk. (This square hole identifies the disk as a high-density disk.) Covering the the square hole will make it an DD disk.
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