The Solution
Floridian....Got it!!!!
I've successfully ran it from 1 Jan 36 to 4 July 36 (figured it would be a good date to end on). Couldn't run it any longer since I'm running it off my USB pen drive on my laptop here at work
Here's what's happening.
Tegetthoff was pretty close:
Try releasing fewer states in the event, maybe split up the event into two events.
You are giving the code a lot of things to do, this may cause the crash. I have noticed that deleting more than 20 units may cause a crash, so releasing a dozen countries in one go may cause the game to crash.
but it wasn't the releasing of all the countries that was the problem (though it does take time to create them all). When the states become nations any land unit or air unit stationed in any of the new nation’s providences become theirs. BUT....all naval units leave the ports that are now controlled by the new nation(s). The AI doesn't even try to rebase them, just letting them waste away. I watched the strength and org fall (org had a replacement rate of -1.7). The US has a boatload

of ships that run out of strength and org all at the same time. The game just can't handle all of that at one time.
I tested my theory by deleting all of the US navy that are ported in the 50 states (don't have to worry about those in PHI, Guam, etc).
We have a couple ways to rectify this issue.
1. Delete all of the US navy that can't fit into Wash DC
2. Programatically rebase them to PHI, Guam, Wake, etc
3. Divy them up between the states/new nations.
So, What do you want to do?
I could have a package for you late tonight or tomorrow morn sometime. Want to clean up some overlapping providence ids between the states/countries.