I had this problem with WMV files (I have the WMV plugin). Other WMV files recoded in VirtualDub, but these were High Resolution 900 x 504 files.
I resolved this problem simply by selecting a Microsoft WMV codec. So this problem is just a codec problem. Having said this, the solution for each user is different depending on the INPUT file. You have to find the right codec for your input file & get VirtualDub to recongize that codec so it is in the list of codecs available to VirtualDub.