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Ok, so to start, please upgrade Presenter. 7.0.0 is very buggy and tends to crash and permanently remove your audio. However what version of Presenter you need to upgrade to is dependant on the version of Captivate that you are working with. In short, Presenter 7.0.0 to 7.0.6 is an AS2 application, 7.0.7 is AS3. Captivate 5 and 5.5 are AS3 applications, Captivate 4 has options for AS2 or AS3, and Captivate 3 and older are AS2 only. You need to have a version of each that is on the same Action Script language. So if you are working with Captivate 5 or newer, you should upgrade presenter using the 7.0.7 installer (which requires that you uninstall your older version of Presenter). You will need your serial key again, so have that handy. If you are using an older version of Captivate, use the Adobe updater (Help > Check for Updates, in any Adobe program) and update 4 times to get to 7.0.6.
As to simplifying the process, you may want to look at just using Captivate. You can make slides like PPT slides in that tool. It may be a little more work to learn how to do it in Cp, but if you only have a couple of slides for the intro and summary, it may be faster than using Presenter and Captivate. You could even try importing the PPT slides into Cp, but you may run into formatting issues.
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You do not tell which version of Captivate you are using. If it is 5 or 5.5 you will need indeed the latest Presenter version, because of the Actionscript incompatibility with previous versions.
I do often insert Captivate SWF's into a Presenter presentation. Of course it is possible to do everything in Captivate, you can even import the Powerpoint. Animations on the PPT-slides will however be converted to Full Motion Recording slides, which can be frustrating if you want to do more editing. But the issue is the resolution: in Captivate all slides have the same resolution, so you'll have to capture at the same resolution as the imported Powerpoint slides. Once I blogged about a workaround (Knockout Master slide) but it is more work. In Presenter you can insert the Captivate published SWF at its native resolution, has not to be the same as the Powerpoint.
Thank you, Jorma and Lilybiri. I am getting a Presenter upgrade today and will upgrade Captivate (I now have version 3) to maintain compatibility. I'll report back here with the results.
I am writing to report the resolution to my problem.
I initially got a Presenter upgrade (to 7.0.7) and a Captivate upgrade (to 5.5) but never did get them to work together well without problems in the sound narration.
I decided to try the "Captivate-only" approach, and that is working well.
My procedure now is to record the demo sessions in Captivate (without narration), import any required PowerPoint slides (without narration), and only then record narration and insert closed captions in Captivate. If you are having audio problems when using Presenter, with narration, as a container for Captivate video, I suggest you try my procedure instead.