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I’m working at a new client and just getting the machine that they have me using working the way I like it. I tried to open a workflow in SharePoint Designer and got the popup dialog: “Failed to load the workflow.” (I had already loaded .NET 3.0 to get the Workflow Foundation Classes.)
A little searching, and I found the answer in Scott Muller’s blog: Navigate to C:\Documents and Settings\<your user name>\Application Data\Microsoft\SharePoint Designer\ProxyAssemblyCache and delete the existing folder (12.x.x.xxxx). (You’ll have to shut down SharePoint Designer for the delete to work.) I’m not sure why it works, but it works!