Have you named each track, and used these names when specifying cuts and dissolves? Look at the Excalibur documentation regarding track naming. It's very explicit about what is and isn't a valid name.

In other words, when you type "M" to insert a marker, are you then adding the track name -- e.g., "1" or "2," followed by a "d" for dissolve and a duration (2:00) for a dissolve longer than what you've set as the default?

This could be the problem.

Jack