Apple has finally approved the sale of Live Cams 4.2, but within hours of release there have been several reports of loading issues. It seems that devices running 3.1.2 (and possibly older versions) of the iPhone OS will not load the app properly. Phones that have iOS4 installed seem to work fine. A patch is currently under development and will be submitted to Apple for emergency release shortly.
For those of you who failed to read this in time, your options are to either upgrade to iOS4 or wait a couple of days for Apple to release the patch. You could also restore a previous backup of Live Cams if you have one synced with iTunes.
UPDATE (July 25th):
The fix has been submitted to Apple and a request for emergency release has been issued to them. The cause of the crash was due to some changes in the latest Apple SDK. These changes (unknown to us) caused the app to attempt to load features only available on the iPad when running on OS 3.x
We hope that the update is released as soon as possible.