Here's an up-date on my problem.
I went ahead and up-grade to Roxio NXT2 Pro in the hopes that would solve my problem. however, nothing changed.
As part of my troubleshooting, I took the liberty of loading Creator NXT2 Pro onto my wife's laptop and it has no problem loading AVCHD .mts files into VideoWave.
I have a Panasonic Lumix DMC-ZS7 camera. Although it will record video in Motion Jpeg format (which works fine with my Creator), these files are limited to 8 minutes in length. Therefore, when I video our church sermons, I use the Avchd format which has no time limit. However, I have to use another product to convert the video files to a format that my VideoWave will accept.
The product I'm using is WonderShare which had its video editor bundled. Both products recognize ad load the same files that VideoWave has a problem with.
I have a Dell OptiPlex 745 desktop computer with a Radeon X1300/1550 Series video card. I have up-dated the drivers to the latest version (2/10/10).
I have also up-dated DirectX from Microsoft
Are there any known issues that I need to address?