Nope, I was having the problem before I installed anything. I had it before and figured it could have been an install issue, so reinstalled W7, run Windows Update etc. only, didn't install anything else, ran WMP12, then after telling it where to find my media it started throwing a fit.
Could it be due to video files that WMP12 needs codecs for, so it gets stuck? I don't normally use WMP for watching videos, I use another player, but have to import it into there to be able to use it on the 360 should I wish to do that.