something on my old pc was preventing the plugin from installing.
I installed it exactly as you described: extract all files to a single directory and double click on the mjp file. The error message was exactly as described by grahamk.
If I copied the .dll directly to the plugin folder, replacing the already installed file, then opened MC's plugin manager, selected the flac encoder, MC produced its "cannot create plugin" error message.
I've just built me a new system, and one of the first things installed, even before all the windows updates, was MC and the flac plugins. They both installed without a hitch.
I have absolutely no idea what was preventing the installation previously, but depends.exe flagged up several files relating to iexplorer 7.0. I then googled a bit on those files and depends.exe and discovered that the results were extremely common, and none of the results I visited offered anything useful.
-marko.