Upgrading to php 5 worked for me too. I’m not using Twitter Tools, but am using Tweet Blender, Tweet This and Twitter Publisher – enabling any 2 of these caused a “Your attempt to edit this post has failed” on a new post. Updating to php 5 meant I could post things again.
ssdesign wrote: “Also I want to take this project forward and make it a opensource project. Any ideas?”
That’s a great idea! Why don’t you register the project on sourceforge? I’m developing a similar flash frontend for wordpress and it would be great to work together on this.