I uninstalled all of my Windows updates and Voila! it works.
I wish I could tell you which specific MS update was the problem but frankly I'm too lazy to reinstall them one at a time and a lot of other problems went away with them.
BTW I also have magicjack.exe set up in a batch file to start with Windows and deleted cdloader from the start folder. Cdloader or magicjackloader.exe works fine for me too though. I did not need the Windows 7 update from magicjack.com.
I hope this helps some people.
Mel