It is a common problem. I have got this problem couple of times and rectified. Sometimes, we may get like below,
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Extension Settings
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SilkTest detected a Client/Server application.
The required Extension has been enabled.
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Problem Cause
Few Silktest DLLs got corrupted for that profile (Say primary user). Thats why it is throwing that error.

Solution
In that same machine, login as other user and run the same scripts.
If it works fine, delete your primary user profile -> restart the machine-> login as the same primary user. Than the scripts will work.
If it doesn't work, you have to check your IE. Try to reinstall IE and run the scripts. Pls see the next tip.

For IE7, You may need to reinstall Silktest again.