This has just started happening for me in Aug, 2015, with Ketarin 1.7.1.
After editing an app definition, making some change, then clicking OK, I get this dialog (ill-formed XML response from some server).
< PNG file attached >
possibly related to all of the constant NET framework updates from MS. Full details in attached txt file.
The changes are nonetheless stored if I click "continue" and then simply close ("[X]" or "Cancel") the edit dialog.
I tried reinstalling 1.7.1 files, without change to behaviour.
ketarin-net-exception.txt