Since updating to beta 1Z3 the game hangs every time at the world creation stage.  Pastebin.com isn't responding to my attempt to post the debug.err file today so I'm posting it here since it's so short.

DebugMessage:  Version 0.302 last updated on: Thu Apr 22 14:09:26 2010
DebugMessage:  Entering WinMain
DebugMessage:  ******* Starting Game Shell *******
DebugMessage:  *********DXDiag info follows.*********
System Info
Time: 4/23/2010, 07:10:32
DirectX Version: DirectX 11
Machine Name: ARCHANGEL
Operating System: Windows 7 Ultimate 32-bit (6.1, Build 7600) (7600.win7_gdr.100226-1909)
Languages: English (Regional Setting: English)
System Manufacturer: LENOVO
System Model: 87445BU
BIOS: Phoenix FirstBIOS(tm) Notebook Pro Version 2.0 for ThinkPad
Processor: Intel(R) Core(TM)2 CPU         T7200  @ 2.00GHz (2 CPUs), ~2.0GHz
Physical Memory: 2048MB RAM
Page File: 1247MB used, 2845MB available
Windows Dir: C:\Windows


Display Info
Display device 1:
Device Name: \\.\DISPLAY1
Card Name: ATI Mobility Radeon X1400
Manufacturer: ATI Technologies Inc.
Chip Type: ATI Radeon Graphics Processor (0x7145)
DAC Type: Internal DAC(400MHz)
Key Device: Enum\PCI\VEN_1002&DEV_7145&SUBSYS_200617AA&REV_00
Display Memory: 894 MB
Current Display Mode: 1680 x 1050 (32 bit) (60Hz)
Monitor Name: ThinkPad Display 1680x1050
Monitor Max Resolution:
Driver Name: atiumdag.dll,atiumdva.cap,atitmmxx.dll
Driver Version: 7.14.0010.0630
Driver Date: 12/1/2008 20:29:34
DirectX Acceleration Enabled: Yes
 


Sound info
Sound device 1:
Description: Speakers (SoundMAX Integrated Digital HD Audio)
Default Sound Playback: Yes
Default Voice Playback: Yes
Hardware ID: HDAUDIO\FUNC_01&VEN_11D4&DEV_1981&SUBSYS_17AA2025&REV_1002
Manufacturer ID: 1
Product ID: 100
Driver Name: ADIHdAud.sys
Provider: AnalogDevices
Driver Version: 6.10.0001.7255
Driver Date: 5/18/2009 17:32:58
Type: WDM
Other Drivers:
Acceleration Level: 1
Cap Flags: 0
Min/Max Sample Rate: 0, 0
 
Sound device 1:
Description: SPDIF Interface (SoundMAX Integrated Digital HD Audio)
Default Sound Playback: No
Default Voice Playback: No
Hardware ID: HDAUDIO\FUNC_01&VEN_11D4&DEV_1981&SUBSYS_17AA2025&REV_1002
Manufacturer ID: 1
Product ID: 100
Driver Name: ADIHdAud.sys
Provider: AnalogDevices
Driver Version: 6.10.0001.7255
Driver Date: 5/18/2009 17:32:58
Type: WDM
Other Drivers:
Acceleration Level: 1
Cap Flags: 0
Min/Max Sample Rate: 0, 0
 


DebugMessage:  *********END dxdiag info.*********
DebugMessage:  Using 4 samples for multisampling.
DebugMessage:  Game Resolution: 1024 x 768 (full screen mode)
DebugMessage:  HAL (hardware vertex processing)ATI Mobility Radeon X1400
DebugMessage:  Presentation Interval: Immediate.
DebugMessage:  Refresh Rate: 0hz.
DebugMessage:  Back Buffer Bit Depth: X8R8G8B8.
DebugMessage:  32-bit z-buffer using 24-bits for the depth channel and 8-bits for the stencil channel.
DebugMessage:  ** Checking Direct3D 9 Device Capabilities ************************************
DebugMessage:  A full-color cursor is supported in hardware at high resolution modes.
DebugMessage:  Bump mapping is supported.
Debug Message:  Device is now ready
Debug Message:  GFX-THREAD: DISABLED
DebugMessage:  Shell initialization complete
DebugMessage:  Elemental: War of Magic is activated.
DebugMessage:  ***** Initializing Game *****
DebugMessage:  Timer Frequency is 0 1dba8c
DebugMessage:  Initializing sound card.
DebugMessage:  initailizing bink
DebugMessage:  No files found matching mask Music\*.mp3
DebugMessage:  No files found matching mask Event Music\*.mp3
DebugMessage:  Create anchor mwin
DebugMessage:  Load texture atlas.
DebugMessage:  InitializeWorld
DebugMessage:  Create popup manager.
DebugMessage:  InitializeMWinStripEngine
DebugMessage:  InitializeMWinDeferredTextRenderer
DebugMessage:  Initialize effect system.
DebugMessage:  InitializeSpellRepository
DebugMessage:  InitializeMusicLayerGroupManager
DebugMessage:  InitializeMultiplayerClient
DebugMessage:  LoadCoreXMLData
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Items\*.xml
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Units\*.xml
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\RaceTypes\*.xml
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Stamps\*.xml
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Effects\*.xml
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Quests\*.xml
Debug Message:  Faction Ability A_Health is Unknown: Being Purged from Empire of Yithril
Debug Message:  Faction Ability RaceType is Unknown: Being Purged from Ilyan Orekeepers
Debug Message:  Kingdom of Altar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Altar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Altar Tried to Adjust Invalid Ability:
DebugMessage:  LoadCoreXMLData finished
Debug Message:  Started Load Game XML Thread
DebugMessage:  LoadGameXMLData
DebugMessage:  Create setup screens.
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Tiles\*.xml
DebugMessage:  No files found matching mask C:\Users\jschmid\Documents\My Games\Elemental\Tiles\Shadows\*.xml
DebugMessage:  No string tables in C:\Program Files\Stardock Games\Elemental\Data\English\*.tips
DebugMessage:  Set mouse.
DebugMessage:  Set update timer.
DebugMessage:  Popup Manager Update: Unhiding FullScreenBink
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  Finished Load Game XML Thread
Debug Message:  Setting a CChooseFactionEntryWnd with a null faction config
Debug Message:  Setting a CChooseFactionEntryWnd with a null faction config
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  - Current Game Settings -
Debug Message:  Selected local player faction: CustomFaction_Altar
Debug Message:  Selected local player sovereign: Lord_Relias
Debug Message:  Human factions:
Debug Message:  CustomFaction_Altar
Debug Message:  AI factions:
Debug Message:  KingdomOfPariden
Debug Message:  KingdomOfCapitar
Debug Message:  Stamp Quantity: 12
Debug Message:  Land Mass Size: 347518504
Debug Message:  Land Mass Min Spawns: 347520408
Debug Message:  Land Mass Max Spawns: 347521360
Debug Message:  Forest Quantity: 4
Debug Message:  Mountain Generation Option: 1
Debug Message:  Map Random Seed: 1272021051
Debug Message:  ---------------------------------------------
Debug Message:  ---------------------------------------------
Debug Message:  Map Size:
Debug Message:      Sectors: 8 x 6
Debug Message:      Tiles: 128 x 96
Debug Message:  Tile Vertex Resolution: 3 x 3 vertices
Debug Message:  ---------------------------------------------
Debug Message:  ---------------------------------------------
Debug Message:  ---------------------------------------------
Debug Message:  ---------------------------------------------
Debug Message:  NOTE: The extra tiles don't appear to be in MapData at this point.
Debug Message:  Map Generation Complete
Debug Message:  Creating terrain objects...
Debug Message:  Terrain objects created.
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  WARNING: (CXFileData) FindRegisteredMaterialIDByName could not find registered material with name 'lambert5SG'
Debug Message:  (WARNING) InitMaterialIDs could not find material ID for material 'lambert5SG'.  No attributes have been applied to this material in the modelling program.  Please add the material name attribute.
Debug Message:  WARNING: (CXFileData) FindRegisteredMaterialIDByName could not find registered material with name 'lambert2SG'
Debug Message:  (WARNING) InitMaterialIDs could not find material ID for material 'lambert2SG'.  No attributes have been applied to this material in the modelling program.  Please add the material name attribute.
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  Kingdom of Altar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Altar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Altar Tried to Adjust Invalid Ability:
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
Debug Message:  Kingdom of Pariden Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Pariden Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Pariden Tried to Adjust Invalid Ability: A_Invent
Debug Message:  Kingdom of Pariden Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Pariden Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Capitar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Capitar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Capitar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Capitar Tried to Adjust Invalid Ability:
Debug Message:  Kingdom of Capitar Tried to Adjust Invalid Ability:
Debug Message:  LoadHKB could not load file Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb because it does not exist
Debug Message:  ERROR: CAnimationNode::Initialize FAILED to load HKB File: Gfx\HKB\Characters\Animation\Biped\Equip\Soldier_Arm_Equip.hkb
DebugMessage:  Updating ZOC.