So the audio in the clip is aac. It's actually a live recording from Garageband cleaned up and exported to iTunes, then brought into iMovie. Still getting LPCM error on all projects it seems.
It's definitely an issue with the audio. I stripped all the audio out of a clip and it exported to 720 no problem. As soon as I added just a random audio effect from iMovie it gave me the LPCM error. Any suggestions on a fix for this?