I think I’ve heard of people having problems with both the hard drive and (DV) video device plugged into the same firewire controller. If you don’t have a 3rd party firewire controller then that might be your problem.
Of course, things may have improved since I first heard that a few years ago. It kinda makes sense though… you’re trying to pull video off the hard drive, process it and send it out to the camera over the same circuits.
Can you view it on the deck while playing the timeline? If so, just crash record it.