Go to options\\Ghostscript and check which Ghostscript version is active. Please use the internal version and save it. Close PDFCreator and test it again.
Tried re-installing, changing to internal Ghostscript, changing color of watermark, and more. Would work 1 time not the next. After 2 hours, gave up and installed 0.97, works. Previous upgrade to either 0.98 or 0.99 had same problem.
Error 53 followed by out of memory if you try to proceed.