The reason why this script is not working lies on line 185. To fix it follow the following.
Most people would have uploaded the entire folder(live-comments-preview) into their plugins folder.
On line 185 there is a function that loads the mock JS file, and the source of this file is incorrect. There are 2 ways you can resolve this.
move the live-comment-preview.php file into the plugins folder directly and delete the lcp folder,
change line 185 from this:
you will notice the addition of the folder name (live-comment-preview) before the file. This was where the error was.
I have tested this and it works perfectly!
I am rewriting this plugin based on the original authors work and it should work with all versions of WP2.2 upwards!
Keep on blogging.