Okay, it's old software and an old computer, but does anyone have any idea what could be causing this?
 
http://forum.cakewalk.com/MIDI-sustain-pedal-glitch-m3799272.aspx
 
Two weeks, 77 views, no responses.
Anything I can try?

When you write "When recording MIDI and I press the sustain pedal, the program stops recording until I release the pedal", are you saying the transport will stop/start in record mode every time you press/release the sustain pedal?
 
I'm not familiar with Home Studio; does it have the 'Remote Control' capability like SONAR/CbB? Sounds like you have Record enabled for remote control by controller 64 (Sustain). Otherwise, I don't know how that would happen.
 
In any case, I highly recommend you upgrade your machine to x64, and migrate to CbB.

The transport continues with nothing being recorded until I release the pedal.
 
That's an interesting idea about the remote control. I don't know and I'll check it out.
 
Frantically holding on to the last century and things I do know (somewhat) and love.

Its an easy jump from X3 to Cakewalk by Bandlab.  You don't have to relearn much.  Its all built on the same concept - just more cool stuff added.

Thanks.
Downloaded X3 and CbB. Pedal works as expected in them.
Now it's more like a mystery; why does the pedal work correctly in MC Pro 24 in Win XP 32-bit, and SHS 6, X3, and CbB in Win 10 64-bit, but not in SHS 6 Win XP 32-bit??
MC pro 24 and SHS 6 on the same machine.
Brundlefly, I see that SHS 6 does have remote control, and right-clicking the Record button does bring up the remote control menu, but I don't know what it all means. More reading is in order, I suppose.
BRainbow, I drive a 26-year old car, too.

Solved.
Did a re-install, didn't work.
Started digging through all of the Options, and in Key Bindings, MIDI 'Shift' options, it was set to Controller 64 (sustain). So when I pressed the pedal, it 'shifted' to something else. Don't know what that was.
Set it to 0 and now the pedal works as designed.
Now I can get back to working on music.
Slowly.
A song every 5 years it looks like.
Maybe.

Thanks for posting your solution. 
 
Being able to bind a MIDI controller to a DAW function can be a very nifty feature, but sometimes having a wealth of options just means more ways to get into trouble. That doesn't stop us from continually demanding more of them, though.

Yeah, Dave, and I gotta wonder how it got that way in the first place. I rarely venture that deeply into the options/preferences menus and don't recall ever going there before.
Brundlefly set me on the right course to a solution.
Luckily, I had a 2-snow day respite from work to investigate.
Thankfully, the power stayed on, unlike others in this area (Guitarhacker) who had to fire up their generators or suffer the cold for hours or days.