I had the same error on Win7.. what solved it for me was installing FL in a diffrent location then the default program folder..
(between here I also started FL and disabled the 3D sound as told in the XFire install instructions, if that got anything to do with it)
And then in FLMM choose "option -> choose a diffrent Freelancer directory" and find the freelancer folder..
and activating it went painless..
