Ive found the issue. You can read more about it in the comments here:
http://notesblog.com/notes/post-widgets/
(scroll down to Chris Rust comment on 14th of march)
I have a beta of 1.0.1 you can download here:
http://dl.dropbox.com/u/4338/notes-postwidgets_1.0.1-beta.zip
BACKUP BEFORE UPGRADING. The patch requires an update to the posts database. It should only affect the PostWidget type post rows in that database table. But its important to make sure you have a backup in case of emergency. 🙂
Will post the final 1.0.1 update to wordpress.org as soon as I have been able to test it a bit more.
And sorry for the late response to this.
1.0.2 is now available (within a couple of minutes).
This fixes this issues. Which was an issue with custom post names being forced to lower case. The custom post type for PostWidgets was called “PostWidgets”. But in 3.1 they became “postwidgets”. Which caused this bug for old PostWidgets created. An upgrade function in 1.0.2 fixes this.