OK, so I'm not the only one having this issue. I'm running Wavepad in XP on my brand new HP Pavillion dv9000 series laptop.
I'm still working through this issue, and while I think it may be systemic, opening Wavepad definitely triggers the problem, which is: it somehow removes my Conexant HD Audio device. The device is listed in Hardware profiles as working properly, but it is not listed in the list of default devices for sound playback (control panel>>sound and audio devices>>audio).
I have had mixed success by removing the device and reloading it and the drivers. Sometimes it works, sometimes it doesn't.
Funny thing is, I have used Wavepad on this laptop before with no probs, and have used it for several years on a much older computer, again, no problems at all. This is especially frustrating, and I am almost ready to throw this HP machine out the window and start over with a Mac.