I've had this problem too, since using the latest version of GKnot and so has PC_Arcade. Easiest solution seems to be just to remux the video and audio stream.
Start Nandub
Open Moviename_movie.avi (created by GK during the encoding process)
Audio-->MP3 Audio-->Pick audio stream (created by GK during the encoding process)
Video-->Direct Stream Copy
Audio-->Direct Stream Copy
File-->Save as......
HTH, there seems to be a serious problem with the latest version of GK. This error was reported on the doom9 forum, but didn't seem to make much impact.
