After perusing the related threads at the Swamp, it seems that this is the root of the problem:
The lisp routine is running inprocess within the user interface thread AutoCAD and if the thread runs for long enough, Windows 7 will throw the 'spinning frisbee'.
"As the OS communicates with a running program through the UI thread, acad can only reply to such communication if the UI thread is idle." - Irneb @ theSwamp
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