Sounds like a PC issue. If your profile specs are current, then you might consider that it's time for an upgrade. Your PC is no slouch, but it it showing its' age. Vegas 10 and DVDA 5 work best with Win 7 64-bit.
How long do you let it go "not responding" before you give up?
How is your hard-disk space?
How does your DVD look in preview?
Your DVD burner is over six years old. If the firmware is up to date and you are still getting the error, try the "autodetect drive" in Preferences.
If that doesn't work, and you are using good media (Verbatim of T-Y), it may be time for a new drive. You can get an internal Sony OEM (Optiarc) that works great for $30.
If the error occurs when clicking on the Make DVD button, rather that the Burn button I suspect that the installation has become corrupted and that you need to reset (press and hold Ctrl+Shift while the application starts) or reinstall DVDA.
I would think a much more logical fix for the error "the bitrate may be higher than some machines can play back" would be to use a lower bitrate. Changing the OS seems rather an extreme solution that probably has very little to do with that error or it's fix.
I too have heard of many cases of people running into problems with Win 7 64 bit. I think they are mainly due to unavailability of compatible device drivers.
The choice of whether or not to go 64 bit seems to depend mainly on the age of your system, including peripherals.