Intially I tried the WordPress Plugin LibXML2 Fix, but it did not work.
To get it to work, I had to edit the plugin itself.To do this I had to modify the file libxml2-fix/libxml2-fix.php
Here is what I did:
I changed The first Line of the IF Statement
From:
LIBXML_DOTTED_VERSION == ‘2.6.27’
To:
LIBXML_DOTTED_VERSION == ‘2.6.26’
I am assuming this first line needs to point to the current version of the library file my host is bluehost is using. This version was 2.6.26
I tried this on a rolled back version of WordPress, 2.7 and also in 2.9.2 and I was able to see my posts submitted from Window live writer correctly each time.