Another 4.0.4 bug!!!
Ok, now, this is really really strange and should be fixed immediately.
Try this:
1) Open Sonar 4.0.4 and set up a new blank project.
2) Add one (and only one) audio track.
3) Set the track input to any input where a mic is connected (and working).
4) Grab a cat or any other pet that could make noise.
5) Arm the track for recording and place the mic next to the cat.
6) Hit record.
7) Now the tricky part is getting any sound from the cat. Do anything you must to achieve this. Also, watch your meters for clipping.
8) Ok, now stop recording and rewind. Add these effects to the audio track: Cakewalk Amp Sim -> PSP Nitro -> DSP-FX Flanger.
9) Choose any random presets for the effects,
10) Now, play back the project and turn up the volume and...
... BAM! The cat is gone!!!!
I can reproduce this 99.9% of the times. I don't know how this slipped through the testing stages but it needs to be solved in 4.0.5 - even before the VST adapter patch comes out.
PS.- I'm not mocking those who have experienced real bugs. I'm just too bored at work. 