Hi everyone,
Unfortunately due to bugs like this it's been decided to completely disable A/V over MSN for Karmic (It's mentioned in the release notes).
However, in order to get better data for upstream there is a telepathy ppa here:
https://launchpad.net/~telepathy/+archive/ppa
If you want to continue helping A/V over MSN you need to install telepathy-butterfly from this PPA! (It will continue to be updated). Filing bugs without running this version of -butterfly will probably NOT be useful so please ensure you're running the latest version!
If you're looking to help fix these bugs here's the list: https://bugs.launchpad.net/ubuntu/+source/telepathy-butterfly/
You can also find people on #telepathy on freenode. Here's the page for how to debug Empathy:
http://live.gnome.org/Empathy/Debugging
Please note that there's a debugging console now!