Phantom Drive in hoster.
 

When I start hoster I get the set drive dialog sometimes. Not all the time, it seems to popup randomly on starting hoster. It detects and finds my only CDROM but shows an untested drive that has a blank label also. I can't close it, save it or anything. I have to task manager KILL it for it to disappear.

This is 4.08 and Vista Ultimate 64bit. I can drop back to an older version and all is well.

Screenies.

http://www.uwpltd.com/1.jpg

This would make me think you have a virtual drive set-up on this computer such as Slysoft's Virtual CloneDrive or Farstone's VirtualDrive.
If so that virtual drive would need to be removed as Hoster will not work with it.
If not then remove and re-install Hoster and check the box at the bottom of the personal information page to remove the registry entries which should clear that out.