ComputerNoob makes a good point that disabling security software doesn't always actually change anything. With some security software it only tells them to not display any notifications.

But I see from your log that LVPrcInj.dll seems to be attaching itself to the process way too early, so let's try to get rid of it.
Open Sandbox Settings > Resource Access > File Access > Blocked Access and add:
*\LVPrcInj.dll

If this fixes the problem, let me know. If not, also add this in the same settings page:
*\snxhk.dll
That should disable avast under Sandboxie.

And the third thing to try:
*\ISWSHEX.dll
to disable ZoneAlarm.

What effect do this settings have on your sandboxed Chrome?

AFAIK, the toolbar comes with the enabling of the web protection module they have included. Since you're using sandboxing, there is no need for it to be on, hence...... problem solved

Hi tzuk,

I did a bunch of troubleshooting today doing the things you suggested. Here are all of the results:

ACTION 1: Added "*\LVPrcInj.dll" to the blocked list. Upon doing so, it said windows file sharing can be used to circumvent Blocked File Access, so it automatically added "\Device\Mup" as well.
RESULT: Chrome now runs properly about 80% of the time, but only when using "sandboxed web browser" icon. When I enable "force google chrome to run in this sandbox" (registered feature), and I use the regular chrome icon, nothing at all happens (no dots in the yellow sandboxie icon and the sandboxie window doesn't show any processes even trying to start).
---------------
ACTION 2: Added "*\snxhk.dll" to the blocked list (and also left "*\LVPrcInj.dll" and "\Device\Mup" in there too).
RESULT: I get the following error: SandboxieRpcSs.exe - Unable to Locate Component: This application has failed to start because C:\Program Files\AVAST\snxhk.dll was not found. Re-installing the application may fix this problem.

Once I click OK, it then says:

Messages from Sandboxie:
SBIE2334 Cannot load DLL file: C:\Program Files\AVAST Software\Avast\snxhk.dll
SBIE2304 Initialization failed for process SandboxieRpcSs.exe
SBIE2204 Cannot start sandboxed service RpcSs (FFFFFFFF)
SBIE2204 Cannot start sandboxed service RpcSs (-1)

Chrome doesn't start at all.
---------------
ACTION 3: Since adding "*\snxhk.dll" wouldn't allow it to start, I removed that and added "*\ISWSHEX.dll" to the blocked list (and also left "*\LVPrcInj.dll" and "\Device\Mup" in there too).
RESULT: It now works 100% of the time using either icon (the "sandboxed web browser" icon or the regular chrome icon (with "force google chrome to run in this sandbox" enabled).
---------------
ACTION 4: Removed *\LVPrcInj.dll.
RESULT: It continued to work 100% using either icon.
---------------
ACTION 5: Removed "\Device\Mup\". (so now the only thing being blocked is "*\ISWSHEX.dll").
RESULT: It continued to work 100% using either icon.
---------------
ACTION 6: Removed "*\ISWSHEX.dll" (now "Sandbox Settings > Resource Access > File Access > Blocked Access" is completely empty). Completely Uninstalled ZoneAlarm. Rebooted.
RESULT: It continued to work 100% using either icon.
---------------
ACTION 7: Downloaded and reinstalled the newest version of ZoneAlarm Free.
RESULT: The regular chrome icon (with "force google chrome to run in this sandbox" enabled) does nothing (nothing at all happens). But, the "sandboxed web browser" icon works only sometimes (back to the original problem).
---------------
ACTION 8: Added "*\ISWSHEX.dll" back to the blocked list
RESULT: Both icons work 100% of the time.

** So, the final result is that everything seems to work perfectly fine if I have "*\ISWSHEX.dll" in the blocked list (or if ZoneAlarm is completely uninstalled). **

@D1G1T@L

Thanks for pointing that out, and I'm sure you're right about that. But as a matter of principle, I'm not going to use a security software that has a toolbar embedded. Besides, when I use someone's software for free, I always play by his rules. So I never try to disable its big pop up advertisement, even though I know a lot of users do. Though I'm fine with the big pop up ad during every update, I'm not fine with the constant nagging (another pop up that last for several seconds) that forces you to upgrade to the latest version, especially if that version contains a toolbar! Anyway, your suggestion is great, and I think most people should follow it.

@markreiss

I am sorry for the above comments as they are a bit off-topic. I won't do it again.

I am running sandboxie 3.64 + latest version Google Chrome, Google Chrome runs fine, no problems at all on Win 7 64 bit + MS Security essentials.

markreiss thank you for the analysis which shows ZoneAlarm is the cause of this conflict.
I will look into that. In the mean time, the workaround seems to be to block ISWSHEX.DLL in the sandbox.

Ok, I'll continue to block ISWSHEX.DLL so that it works for me. If you need any additional information, tests, or want me to try any beta versions, please let me know. I'm happy to help in any way I can to get this resolved.

I installed ZoneAlarm on an XP test computer but I don't see the problem with Chrome 17. I added avast because I thought it might play a part in this, but still can't reproduce the problem. It might be something specific to your computer, strange as it is.

Version 3.69.03 adds a compatibility setting for the Logitech Process Monitor Service which should fix this problem.

Related topics:
http://www.sandboxie.com/phpbb/viewtopic.php?t=12907
http://www.sandboxie.com/phpbb/viewtopic.php?t=10678