Hello,
Sounds like a problem with your codecs, installation or activation.
Try uninstalling PowerDirector completely and then reinstalling. See if that helps. If you can get a clean uninstall, it should help.
Then when you have it installed, put a test MPEG-2 on your timeline and produce it. Make sure you are connected to the internet when you do that.
If it still doesn't work, contact CyberLink's technical support.
https://membership.cyberlink.com/support/service/technical-support.do
David