Verify that the MPEG-2 encoder is registered. To do so, try opening an MPEG file and if the program asks for registration, follow through the registration process.

If you do not have an MPEG file to open, open up an AVI or import a still picture into the timeline. Then go into the File menu and select Render As. Change the "Save As Type field" to MPEG-2 and try rendering. If the programs asks for registration, follow through with the registration process.

You may also want to try running the Migration Tools. To do so, go to your Start menu (with all our software closed) and select Programs. Then select Sony then Utilities and Migration Tools. Click on each item in this list except the Readme, one at a time. When you click on them, you won't really see anything happen though when you are finished try capturing again.