Here is the answer I got from Applian on this issue:
Regarding the Cannot run graph error - 99.9% of the time this is unresolvable, it has to do with a driver conflict and basically means that directshow does not function properly... which is beyond our control.
There is a SLIGHT chance to get it working, but again..this is beyond our control so I can't make any promises.
From my understanding, The "Cannot Run Graph" error is related to the version of DirectX installed on your machine. You need to have version 9 or higher installed in order to run WM Capture. My recommendation would be to make sure you are running DirectX 9 (or 10 if your graphics card will support it) and that should take care of the problem.
Also, You might want to try uninstalling
WM Capture, restarting your computer and re-installing it. Usually this has to be done for it to realize that the proper version of DirectX has been installed.