Comment 14 for bug 184337

I think I have narrowed it down a bit. When you type a full command into krunner (alt+f2) the first option will be "Default: Run your_command (Command)" and this will work, but if your run ANY kde 3 application specifically by double clicking it's entry on the list (in other words, any kde 3 app listed as an app, not as a direct command) then you will recieve the error:

KDEInit could not launch '/usr/bin/the_app'.

but the application will still launch without a problem.

Hope this helps narrow the bug down!