Hello John,
We understand that you were able to use Movie Maker back in October 2012 but just to confirm, was it the "old version" that was working fine (the 2.6 version) or was it Windows Live Movie Maker 2011? You have submitted sample files for us to investigate and we saw that you had the old version (MWSMM file extension for the 2.6 version) as well as the new one (WLMP file extension for WLMM 2011) included in those. So just to clarify this issue further, the old project file which was created in the 2.6 version and was running under the Vista platform would eventually work fine assuming that you were using this version prior to getting the 2011 version installed. The reason we can say this is because based on the log files you have submitted, the video card driver version running on that machine was from a 2008 update and therefore can support the project file as well as the application if you were using the 2.6 version.
As for running Windows Live Movie Maker 2011 version on your Vista machine, it can be done so with no problems at all provided that the "video card driver version is up to date". As stated above, the video card driver running on your VISTA machine was from a 2008 update - 3 years even before WLMM 2011 was created. Pointing out to my previous post as well, these new Movie Maker versions (both 2011 and 2012) uses "extensive graphics rendering application" meaning it will fully utilize your video card's hardware functionality and if these are not updated appropriately then one should expect to run into problems when doing so (one of which would be crashing events as the hardware could not handle the requirements needed by Windows Live Movie Maker 2011 to run properly). This is the reason why we keep urging you to have this hardware of yours updated in order to, if not alleviate, solve the concern that you are having.
Please understand that as much as we would want to help you out further with your concern, if there would be limitations as to what your VISTA machine could do then we would be stuck in a situation where we could not diagnose further what needs to be done in order to get the problem resolved. I am wondering as well as to why your laptop does not accept new updates whereas upon checking the website of your video card's driver updates, I can see that new versions are made available for you to download and install. If you are unable to use Windows Live Movie Maker 2011 on your VISTA machine, then it would be best to use another one that works and has an updated driver version for this matter.
Sincerely,
Windows Live Global Escalations Team