I can't think of anything that has changed in version 3.2 that would cause a lock-up. Actually, because the TD runs inside of IE, it shouldn't be able to cause a lock-up no matter what it does.
But that, with an out of memory error, and a strange permission denied error, tends to make me think there might be an "environment" issue. Could be something's hosed up on the PC. The only real suggestion I can think of is to update or re-install IE. What version of IE are you using?
As an aside, the only legitimate "out of memory" error I've ever seen related to the TD (and I use the word "legitimate" very loosely, because it still should not have caused this type of error) was when someone was using the software in an unexpected way. They had a database of thousands of players - I want to say 6 to 10 thousand, but I honestly can't remember. Each tournament they ran had 10 to 30 players. But instead of simply adding the 10 to 30 players to the tournament, they added the entire database of players to the tournament and only bought-in 10 to 30 players. Everything still worked, but the memory footprint of each tournament was very big - enormously bigger than necessary. With dozens of these tournaments saved, when Statistics were run the TD's memory size bloated to huge proportions and an "out of memory" would be hit. The solution was, of course, very simple: stop adding the entire database of players to each tournament. I loaded every saved tournament, removed all players who had not bought in, and re-saved the tournaments and of course the problem went away.
I'm relating this to see if any alarm bells go off for you. Not that you're doing this, exactly, but maybe something else. I never dreamed anyone would use the software in this way, but of course that's the way it is with software development. We intend for the software to be used in a certain way and those who use the software always find other ways to do things.