Garrys Mod Hammer problem

Needless to say this problem started after SDK was broken and then was fixed again.

I have reset all the game configurations.
I started the configuration using “Source Engine 2007” and Episode 2
I then followed the info on http://wiki.garrysmod.com/?title=Configuring_Hammer to set Hammer up.

The viewports work fine, entities work fine. The problem I have is when I compile the map. I get the following:

Valve Software - vbsp.exe (May 7 2010)
4 threads

After this it just hangs up after this point. I know there is not a issue with the map, I can compile and run it fine using Episode 2.

I have tried changing the BSP field under the Build Prorgrams to the new info for episode 2. When this is done it will compile the map fine. But, when it tried to run the game after compile I get another error once the client loads up and it tries to load the map.
I get:

Engine Error
Lua Error Dump

I have tried exicuting the clint with the same paramaters that Hammer used and I noticed that there are a whole lot or lua errors. When trying to load the map manually from there it crashed the client and I get that same error. I know its not the map becouse I can run the map fine with a normal launch of gmod. I know this does not have to do with any addons I have since I have tried remocing all the addons that I do have. Its also not a corrupted install either. I have recently reloaded my computer with Windows 7 64-bit, but was still getting this same problem with Windows XP Pro.

Any help or info would be great. Oh and I did try searching. Seems that search is broken at the moment.

Don’t launch gmod from hammer. It breaks things.

Use the source engine 2007 compile tools. The wiki page hasn’t been updated in a while.

Ok, will use the 2007 compile tools. One of the main reason for launching it from Hammer was to make placement and debugging of info_nodes easier. In my last map I had to open it in Episode 2 to do this. I can still do this, but would like to not have to worry about the extra step.

Well you can leave gmod open when you compile, the entities and shit updates.

You could also use the map_edit <map name> console command to place nodes.