Locks up when saving & will not show preview

When I try to create a new project or save-as the blank project that opens by default, or export the video, Openshot locks up.
My HDD drive light comes on and the program sits there. Cancel button does not work.

I am unsure if this is related but I also cannot preview anything. I can add images or video-clips or audio clips to timelines but when I click on the play button in the preview window the only thing that changes is that "Video Preview" will change to "Video Preview Paused"

I have attached the output when run from a terminal.

I installed openshot on Ubuntu 12.04 from the ppa:openshot.developers/ppa
I have also run apt-get build-dep openshot because I was going to compile it from source until I read the info here: http://www.openshot.org/download/ After reading this I simply installed it from the ppa as instructed.

I can watch video's correctly using the commands:
$ fmpeg video.avi
and
$ melt video.avi

The terminal output states:
------------------------- ERROR 1 ------------------------------
Failed to import 'from openshot import main'
Error Message: cannot import name main
----------------------------------------------------------------
This looks like it might be the issue to me, but I do not know how to fix it.

Please advise
Thanks :-)