wow larryhn - you add nothing to the discussion. That's called a troll.
No thanks to 4 different apple forum postings/ thanks to a youtube video, I solved the problem.
For others who are experiencing similar issues, check:
iPhoto - preferences - sharing - make sure the boxes are checked for sharing your pics.
Also, make sure you aren't trying to copy thumbs only. I figured this must have something to do with the way pre-iphoto 8 versions merged info with the newer ones.
I would have older pics, say from 2007 or older, and apparently on the older versions of iphoto, you could delete the original file but still have the thumb show up on the preview. You know this is the case when you click on the thumb and you get a grey jpg with an explanation ! point.
So if you are trying to just pull off a few pics here and there to an EHD like me and it's giving you the unable to export error, check your SHARING PREFERENCES
oh, and larry/others who choose to make this a flame session - have fun as I am not subscribing to updates.