I just installed the latest version of Klite Mega Codec Pack and I noticed the Halii splitter was selected. I checked the box for the Windows media splitter (which shows as "recommended"), installed the codec pack and rebooted. Then started MMVideoSplitter, chose an .avi file that wouldnt open before, split the video and it works just fine. Happy days! Maybe this info may be helpful to any others having a similiar problem.
Thanks again Demitry for you quick response.