| Internal Error has Occurred, Proceed with Caution" means something unexpected has happened within APPX, sometimes the result of something happening before your current operation. Instead of proceeding with caution, tell your users to write down the last three things they did, then exit Appx, then to contact you.
If you can reproduce the error, we'd love to get a copy of the replication, so we can fix it. Frequently the error is not easily reproducible, so any scenario we can get that reproduces it would be helpful.
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FAQ's - APPX Software, Inc. : 
Message; “free_pool() - attempting to free unallocated memory ()”