These are steps that fixed the problem. Perhaps they will be of use to someone else.
1. Verified the on-board sound card was disabled.
2. Opened the M-Audio Control and set latency to lowest setting.
3. Launched Sonar X1. The ASIO and ASIO4ALL drivers appeared in Device Driver drop-down.
4. Chose ASIO, but after 'Apply', it was the ASIO4ALL driver that was checked.
5. Unchecked ASIO4ALL, selected ASIO, but after 'Apply' got error message.
6. Closed Sonar.
7. Uninstalled, then reinstalled Win7(64) driver from M-Audio.
8. Launched Sonar. Selected ASIO as before. Done.
Now in Sonar the 'Asio Panel' button is active (it launches the M-Audio Control). The 'Buffers-In-Playback-Queue' text box and the 'Buffers-Size' slider are inactive.
Thanks again for your help!!!!