The only relationship I can imagine behind a keyboard command and a change in the behavior of softsynths would be if some kind of bank/patch change was sent. So your synths are looking for instruments in the wrong bank. If your keyboard has bank selection buttons or controls that can be mapped to that function I would look there.

slartabartfast
The only relationship I can imagine behind a keyboard command and a change in the behavior of softsynths would be if some kind of bank/patch change was sent. So your synths are looking for instruments in the wrong bank. If your keyboard has bank selection buttons or controls that can be mapped to that function I would look there.

I believe that this could be the culprit in this case. 
I am able to send commands (more than my knowledge of these things) from my M-Audio Radium 49 (never used it), but it seems reasonable to think is those directions that are at fault.

JohnD - When loading an old project and adding a new VSTi, the new VSTi does not play back. I can add a recording to the existing VSTi.
Slartabartfast - I would have thought doing a factory reset would have corrected any issues with bank change/patch change info, although your suggestion is quite logical.  
Ken - I have checked a new installation of Real Guitar on another PC and it works fine. 
So, still at a loss. I am considering a complete re-intsall of Sonar and all VSTi's, as painful as that would be but I have this nagging thought that the problem could still exist after that because the issue may be hardware based rather than software based.
Thank you all for your great suggestions so far. 

Try another midi cable or USB port (If that's how it receives midi).  If that doesn't help --
 
Take your HW keyboard out of the equation.  Unplug the midi/USB cable temporarily (Whatever cable is transmitting midi to the PC).  Reboot your system, then start Sonar.
 
Load up a VSTi with an onscreen keyboard (ie. CW Sound Center).  Using the onscreen keyboard, does it make a sound?
 
If so, then the HW keyboard and/or it's connection is likely causing the issue.  If not, I'd proceed with the clean install of Sonar. 
 
(I really don't think reinstalling your VSTs will make a difference).

Thank you for the advice. I will give that a shot today and see how that goes. I did try re-installing a couple of the VSTi's but, as you suggest, it did not make a difference. 

If you've got old projects working you're a long way from reinstalling Sonar. In any case unless you delete all the necessary registry keys you will Bly repeat the current installation which we presume the re installation is supposed to fix.
Do you see activity in the channel meters? Midi and audio tracks and busses.

If there is absolutely no activity or only in the MIDI track then. These things will point to where there may be a routing error.

JohnD - I tried your suggestion of taking the HW keyboard out of the equation and using a virtual keyboard but the problem persists.
 
Mike, there is activity in the channel meters for both audio and midi. The signal routed through my Sound Canvas module triggers midi and I can hear all midi sounds. The problem is with the VSTi's. Midi activity is shown and the channel meters register the signal but there is no sound! 

If i switch off / on one my keyboard controller, the current active VST will be shut to zero volume. And if I save it, it will remain no sound. Took me a while to figure that one.
 
Unrelated, I'm also currently experiencing no sound when adding a new soft synth track - only for Kontakt player.. might have to do with the add soft synth options, I'm going to check that out soon.

Thank you for the advice, Albert. I have checked that but that does not appear to be the problem. Good luck with your Kontakt player issue.

mudgel
... In any case unless you delete all the necessary registry keys you will repeat the current installation which we presume the re installation is supposed to fix....

Agreed, which is why I suggested a clean reinstall of Sonar. 
 
Personally, I'd try a system restore first (to a point before the problem started).  If not possible, or it doesn't work, then do the clean reinstall of Sonar.  Here's a post with instructions for X3:
 
http://forum.cakewalk.com/FindPost/2919315