Try running ChkDsk to check your drive for errors. Right-click your Drive icon/ Properties/ Tools/ Error Checking. Try it first by not checking either box (this will run it in a Read-only mode) to see if it flags any hard drive or file problems. If it does, restart it by ticking both boxes, and rerun it to allow it to attempt to fix any found problems.
Have you tried uninstalling and then reinstalling Windows Live Movie Maker?
Have you tried the Movie Maker forum?
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