Craig you were right! IE 5.01 updates the Microsoft VM. As I was downloading the update, I checked into the MSDN info on bugs with Microsoft VM and found a similar description of the problem I was having with Liquid Motion. I've republished the animation into an html page and all is well! Thank you!

http://nappconference.com/test.htm

For anyone looking to work with Liquid Motion v1 and FrontPage here's what I learned:

1. Make sure you have the latest version of Microsoft VM for Java development.

2. Disregard the Liquid Motion publishing instructions that direct you to publish your animation to the html page currently open in FP editor, this doesn't work.

3. Publish your animation using the local disk option. Then pull the entire folder into FrontPage using Import option. Leave that directory structure intact after import, and leave the html page containing the animation in that new folder.

4. Copy the *.x and *.jcz files from the animation's folder to the root folder of your frontpage web (copy... not move)

5. And most importantly - after viewing the html page containing the animation in FrontPage Editor, when you go to close the page/editor it will ask you if you want to save (even if you did nothing but look at the page). Do NOT let the editor save the animation page!!!

So I had some hassles with this... I still think this new Liquid Motion tool is fairly easy to use. < g > despite my intial rant =D)