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The first thing I want to say is that this is an excellently posed question. Thank you.
I'm pretty sure that your AE is up to date but check to make sure. I'm on a Mac so right now our build numbers are different. There is no Multi Processing in CC 2015 because the entire rendering architecture is being rebuilt.
Make sure Magic Bullet is up to date. As good as it is I have not updated my Magic Bullet for quite a while because have a different workflow for color grading.
The problem I see is with the Render Settings. Quicktime has completely dropped their support for H.264 in a Quicktime container. It never worked well and when it did it was slow to render and unreliable as a delivery format. I would never use that format. If you can use the Adobe Media Encoder to render your h.264 as an MP4 using one of the default presets then that's the way to go. If you render a comp directly in the AME it will take longer than rendering through AE's output module because AE will be running in the background. If you used Ray-tracing and have an NVIDIA / CUDA compatible card then the AME will not use your GPU for rendering and it will take forever and may not work at all.
I'm assuming this is your final render pass because you are choosing an MPEG format that is really not suitable for further editing and re-compressing. My recommendation would be to first purge your disk and image cache in AE and then render to a suitable production master format from the Render Cue and then encode your H.264 in the AME. Many times this will be faster than rendering a comp directly in the AME. By far the shortest render times in the AME come from a good quality lossless production master. Most of the time I just send renders to the AME directly from AE and then I keep working on other shots because I can't afford to wait for renders. This is the most efficient for me, but if the project is under a tight delivery deadline I'll usually render a production master from AE and then compress it in AME for delivery.
If you still get the error there could be one other thing going on that may be fixed by changing the cache settings in the Secret panel of your Preferences. You access that panel by holding down the shift key when you open Preferences>General. Disable Layer Cache and purge every few frames.
Yes, AE and plugins are all up to date. And correct this was the final pass, it's going online and from what I've read most places recommend H264. I wasn't aware of it's lack of support and instability in Quicktime, thanks for the information. I've tried a couple more test renders on Windows 10 with different codecs and am getting good results without failures so it would appear to be a H264/Quicktime issue as you suggested. I will render out a lossless final pass and then encode/compress for delivery in AME or third party.
I'm relatively new to motion graphics and don't come from a video background so I'm still learning about codecs. Many thanks for your comprehensive response, and I appreciate the insight into your workflow.