iTunes 9.1.0.79 error syncing with iPhone 3G

I have never had a syncing error with iTunes 9.03 and below, but since upgrading to 9.1.0.79, I get the following error:
The iPhone XXXXXs iPhone cannot be synced. There is not enough memory available.
My iPhone still has over 5GB of free memory, my computer has 3GB of RAM, and my hard drive has 36GB of free space. Which memory is lacking? I suspect this is a bug in iTunes 9.1.0.79.
Anyone else out there with the same problem? Or perhaps any suggestions?
Thanks.
Here is a log from the iPCU (hint, hint, any Apple techies reading this):
Fri Apr 9 01:32:05 unknown SpringBoard24 <Notice>: MultitouchHID(208b30) uilock state: 1 -> 0
Fri Apr 9 01:32:05 unknown SpringBoard24 <Notice>: MultitouchHID(376f330) device bootloaded
Fri Apr 9 01:32:13 unknown SpringBoard24 <Notice>: MultitouchHID(208b30) uilock state: 0 -> 1
Fri Apr 9 01:32:19 unknown SpringBoard24 <Warning>: SB SYNC: iTunesSyncRequestedStart 0
Fri Apr 9 01:32:19 unknown SpringBoard24 <Warning>: SB SYNC: beginSyncing 1
Fri Apr 9 01:32:19 unknown SpringBoard24 <Notice>: MultitouchHID(208b30) uilock state: 1 -> 0
Fri Apr 9 01:32:19 unknown SpringBoard24 <Warning>: SB SYNC: didShowSyncPanel 2
Fri Apr 9 01:32:19 unknown SpringBoard24 <Warning>: SB SYNC: _notifyAppsSyncWillBegin 2
Fri Apr 9 01:32:19 unknown SpringBoard24 <Notice>: MultitouchHID(376f330) device bootloaded
Fri Apr 9 01:32:24 unknown misagent1634 <Error>: profile not valid: 0xe8008011
Fri Apr 9 01:32:29 unknown BackupAgent1640 <Warning>: BackupAgent starting up...
Fri Apr 9 01:32:29 unknown BackupAgent1640 <Warning>: Backup session starting
Fri Apr 9 01:34:52 unknown com.apple.mobile.lockdown16 <Notice>: receive secure message timeout!
Fri Apr 9 01:34:52 unknown lockdownd16 <Error>: (0x83e800) handle_connection: Could not receive USB message #8 from unknown. Killing connection
Fri Apr 9 01:34:59 unknown SpringBoard24 <Warning>: SB SYNC: iTunesSyncHasCompleted 2
Fri Apr 9 01:34:59 unknown SpringBoard24 <Warning>: SB SYNC: didEndSyncing 5
Fri Apr 9 01:35:00 unknown SpringBoard24 <Warning>: ITDBPrepServerPostProcessRun: BEGIN looking up itdbprepserver.
Fri Apr 9 01:35:00 unknown itdbprepserver1657 <Warning>: starting up.
Fri Apr 9 01:35:00 unknown itdbprepserver1657 <Warning>: acquired iTunes sync file lock.
Fri Apr 9 01:35:00 unknown itdbprepserver1657 <Warning>: acquired itdbprep file lock.
Fri Apr 9 01:35:00 unknown itdbprepserver1657 <Warning>: posting com.apple.itdbprep.notification.willBegin
Fri Apr 9 01:35:00 unknown SpringBoard24 <Warning>: ITDBPrepServerPostProcessRun: -END- looking up itdbprepserver. success = 1
Fri Apr 9 01:35:01 unknown itdbprepserver1657 <Warning>: BEGIN processing command: com.apple.itdprep.command.runPostProcess
Fri Apr 9 01:35:01 unknown itdbprepserver1657 <Warning>: BEGIN ITDBPostProcessController...
Fri Apr 9 01:35:01 unknown com.apple.itdbprep.server1657 <Notice>: warning: Could not compile statement SELECT value FROM _SqliteDatabaseProperties WHERE key = ?;: no such table: _SqliteDatabaseProperties
Fri Apr 9 01:35:01 unknown com.apple.itdbprep.server1657 <Notice>: warning: Could not compile statement SELECT value FROM _SqliteDatabaseProperties WHERE key = ?;: no such table: _SqliteDatabaseProperties
Fri Apr 9 01:35:01 unknown com.apple.itdbprep.server1657 <Notice>: warning: Could not compile statement SELECT value FROM _SqliteDatabaseProperties WHERE key = ?;: no such table: _SqliteDatabaseProperties
Fri Apr 9 01:35:02 unknown itdbprepserver1657 <Warning>: BEGIN Post Processing...
Fri Apr 9 01:35:02 unknown itdbprepserver1657 <Warning>: Skipping iTunes Commands.
Fri Apr 9 01:35:02 unknown itdbprepserver1657 <Warning>: Running Misc Commands...
Fri Apr 9 01:35:02 unknown itdbprepserver1657 <Warning>: Running Sorting Process...
Fri Apr 9 01:35:08 unknown SpringBoard24 <Notice>: MultitouchHID(208b30) uilock state: 0 -> 1
Fri Apr 9 01:35:12 unknown itdbprepserver1657 <Warning>: Running Create Triggers...
Fri Apr 9 01:35:12 unknown itdbprepserver1657 <Warning>: -END- Post Processing.nnStatsnttotalMLSITDBPostProcessing=10.10sntcommands=0.01ntmisc=0.54snticuSort=9.11s (MLS_icu_data=1.07s, MLS_icu_sec_data=0.34, dropIdx=0.05, normalize=0.55, update_orders=4.02, tStatsICUOther1=0.02, createIndex=4.06)nn
Fri Apr 9 01:35:42 unknown itdbprepserver1657 <Warning>: *** STARTING: DB Backup (CREATE-NEW) ***
Fri Apr 9 01:35:42 unknown com.apple.itdbprep.server1657 <Notice>: warning: Could not compile statement INSERT INTO item_to_container (item_pid, container_pid) SELECT item.pid, ? FROM item WHERE (((item.media_kind & ?) OR (item.media_kind & ?)) AND ((item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)) OR (item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)) OR (item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)) OR (item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)) OR (item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)) OR (item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)) OR (item.genre_id = (IFNULL(SELECT genre_map.id FROM genre_map WHERE genre_map.genre, ) COLLATE ML3SearchCollation = ?)))): near SELECT: syntax error
Fri Apr 9 01:35:43 unknown itdbprepserver1657 <Warning>: *** FINISHED: DB Backup (CREATE-NEW, time = 1.60s) ***
Fri Apr 9 01:35:43 unknown itdbprepserver1657 <Warning>: Initializing MusicLibrary
Fri Apr 9 01:35:44 unknown itdbprepserver1657 <Warning>: -END- ITDBPostProcessController.nnStatsnttotalTime=43.34sntensureIndices=23.58n
Fri Apr 9 01:35:44 unknown itdbprepserver1657 <Warning>: DONE processing command: com.apple.itdprep.command.runPostProcess
Fri Apr 9 01:35:45 unknown itdbprepserver1657 <Warning>: posting com.apple.itdbprep.notification.didEnd
Fri Apr 9 01:35:45 unknown itdbprepserver1657 <Warning>: Releasing locks.
Fri Apr 9 01:35:45 unknown itdbprepserver1657 <Warning>: exiting now.
iPhone 3G iPhone OS 3.1.3 Windows XP Pro (32bit) AMD64