Dear Sam,
I feel your pain and so do a number of people with the same problem. Adobe does not have a patch for this bug because it really seems to be unpatchable. Thus, some of Adobes suggestions are just frustratingly unhelpful. Anyway, I fixed the problem and here is the fix. Hope it works for you.
Firstly, you will have to uninstall the entire Master Collection CS4 or whatever you have of CS4 – including Encore etc…
You then need to run the Adobe CS4 Clean Script which is designed to resolve some problems and is available at – https://www.adobe.com/support/contact/cs4clean.html
Reboot and reinstall CS4 which may take hours. Sorry for suggesting a solution that will probably take you a full day, but it is the only way.
As I had installed CS4 on two similar computers and had no problem with one of the installations, I am guessing that the problem was triggered by two possible things:- My firewall may not have given permission to one of Dynamic Links requests – recommend you allow all requests if you have a firewall.
The other thing that may have been the problem was opening up CS3 projects in Premiere Pro. Hopefully this clean script will overcome that. As things are just fine at the moment I am hesitant to open a CS3 project just yet. I will take a Drive Image first before doing so and when I do I will let you know if a problem occurs.