Looking at all the responses, apparently no one has been able to come up with a solution. So maybe you can come up with a work around.
Fortunately, you are not locked in to using just the transitions in iMovie. For instance, you can check out the numerous transitions available at www.geethree.com and buy a plug-in to use with your project. Their Slick 3 package has a transition called "Diffuse - Little" that looks like iMovie's cross-dissolve. I think that the package costs about $50.
A program called Photo to Movie also purportedly has a better Ken Burns type effect than iMovie, and you probably could create your slide slow entirely in that program, which works well with iMovie.
Also, you have access to transitions through the iPhoto slideshow program that's already included in your iLife package. So, for example, if you have two Ken Burns photos where the cross-dissolve transition is showing a black frame in iMovie, switch those two photos into an iPhoto slide show and add the Ken Burns effect and cross dissolve there. You can have iPhoto automatically add it, or you can manually add it, and in either case your adjustments to the Ken Burns effect will be somewhat limited. But if the effect is satisfactory, then export that slideshow as a Full Quality Quicktime movie and insert it into your iMovie project.
In iMovie you also can eliminate the transition altogether or use another one that works.
Another thing you could try is exporting your contiguous Ken Burns photos, without transitions, from iMovie to Full Quality Quicktime movie, and then import that Quicktime movie into your project, split it at the transition point, and then add the transition and see if it works.
I would try adding the transition by dragging it into place in your time line, and if that doesn't work, try selecting the clips on each side of the transition and adding the transition by means of the add button in the transitions pane. Or try adding the transition in the Movie line instead of the Time line. Or try adding the transition and then updating it to see if that eliminates the black frame.
A reinstall of iMovie might be something to consider as well.
In other words, keep poking around until something works.
Good luck with this.