Here is not so much a bug report but a work around I have found.

I have v1.9.945.3863 which might have been the cause of the issue in the first place.

With Windows Server 2003 and Server 2008 I was getting an error when trying to join a host session.

Because of the extra security settings for server IE configurations Screen connect errors out with a dialog:

"Cannot Start Application.
Cannot continue. The application is improperly formatted. Contact the application vendor for assistance."

OK and Details buttons appear.

When clicking on Details button you are informed that unsigned applications are not allowed.

The msg is a little misleading, I tried enabling every activex unsigned setting I could find. Nothing worked.

Then I thought more and found the following fixes it:
In Internet Explorer goto Tools->Internet Options->Security->Custom Level->.NET Framework-reliant components->Run components not signed with Authenticode->Choose Enable or Prompt

Hope that helps anyone else with the same issue.

Regards