Because BetterSound takes control of the sound card, no other programs can access it. My guess is that MSN expects to have access to the sound card, when it doesn't, it crashes.
If I'm right, you can workaround this by installing a virtual sound card like Soundflower. In that case, BetterSound will take over your real sound card and play music, and MSN will output sound into the virtual sound card. You won't hear any sound from MSN, but hopefully it won't crash.
Alright I see what you mean. Don't need sound from MSN anyway, so will give Soundflower a bash soon. Thanks!