Was editing along fine with a couple of WMVs and a WAV file on the time line. Could see the audio peaks fine.

For no apparent reason, now when I open the program I get "An error occurred while creating a proxy file for a stream. The file could not be created."

I removed the .sfap0 and .sfk, and let Vegas attempt to rebuild them, but it cannot do it.

I can still see the video thumbnails.

Any reason why?

(I know I should be running 11, but I'm on a 32-bit XP system and cannot upgrade.)