I can't reproduce the problem on XP SP3. Here is a screenshot of MJ14 running four lame encoder instances on my quad core Phenom II computer.
Click to enlarge.I tested the current 32-bit LAME encoder version, v. 3.98.4 (not v. 3.99, which is a development version).
My settings:
--noreplaygain disables the redundant replay gain analysis by LAME (the LAME replay gain tag is rarely supported in applications - use MJ's analyzer instead) and -V1 is the VBR quality setting (on the scale of -V10 ... -V0, -V1 is between "--preset standard" and "--preset extreme", aka JRiver's "VBR High" and "VBR Extreme").
%programfiles%\J River\Media Jukebox 14\Plugins\lame.exe
I wonder if a different encoder path could make a difference. Could you try a direct path that points outside the program folders like the one in my screenshot?
EDIT
I didn't try ripping - just encoding. I have now tested also ripping. It indeed seems to crash after the first track. Perhaps the ripping engine is not compatible with the external encoder plug-in. A workaround could be to rip to wave and convert the files after ripping.