When you open the Browse dialog the application hangs, nothing appears in the dialog and the application stops responding
The screenshot indicates that you are using Windows 8. Please note that not a lot of testing has been done on this OS.
I have seen this issue occasionally on my work system (Windows 7 64bit), but have not been able to root cause it (it happens one in 10 times I start the program). The issue is that it takes a while to find the default directory (Downloads directory for the logged in user). To bypass this issue, you can set "DiskImagesDir" to a path on your system (i.e. DiskImagesDir=c:\MyImages).
I am experiencing this same issue with Windows 7 x64. I run wind32diskimager.exe, click the browse button and it crashes. I am not sure what you mean by "set 'DiskImagesDir' to a path on your system". I tried adding an environment variable with the name "DiskImagesDir" and the value as a valid path on my local system, but it doesn't help. I am now completely unable to image SD cards from my PC and I have to go to another PC to do this. I also tried redownloading and extracting the files, this did not help either.
I can't edit my post, but I would like to add one more thing. If I manually type or paste the path of the image, all works fine, but browsing for one does not work at all.