Upgraded to RC3, same problem.
Managed to apply the patch after some research, but it doesn’t work. Must be for a different issue. Reverted back to original version of wp-cat2tag importer.
Looks like if this is a know about issue for 3.0-RC1. There is a patch at http://core.trac.wordpress.org/ticket/13460.
Not sure how to apply it though. It’s a *.diff file.
I’m getting the same error message. I’ve imported a blogger.com blog and need to convert the categories to tags. I’m also using the development version (3.0-RC1). Anyone’s help to resolve this ASAP would be appreciated.