Thanks for the replies.
An update to what I found.
The other change made to my system was the installation of iTunes (against my will actually - universities are using the iTunes platform for distribution of content...I'd love it if I could use MC to access sites such as
http://itunes.stanford.edu/ rather than being locked into the iTunes store software. Is this possible?...but I digress)
So, the following behavior was occurring:
1. Run MC by itself - the ActiveWindow problem occurs
2. Use MC to play my media, but keep iTunes running in the background - the problem goes away
After using my computer in situation number 2 for a while, I went back to running MC by itself. The ActiveMovie window problem seems to be gone. The only setting I changed was to stop iTunes from prompting me to make it the default music player.
Strange..but the problem seems to be resolved for now.