Differential encoder hard crashes the PC MESA7i77

here are the pictures. the one with the white folding table background is the old one.   

Thank you. I am starting to feel like I really must have missed something obvious here...

OK guys, 
Finally back on this again. Got LinuxCNC stable, ended up being a failing hard drive issue. Got my 6i25 and 7i77 boards back from MESA, everything checked out ok. 
I am still struggling on the MPGs. Still crashes the computer when I scroll the MPG handwheel. Its a differential encoder, plugged into encoder #3 slot on the 7i77. I have tried a new MPG, same result. I would say its safe to say the MPG hardware is not the issue. 

Can you power the 7I77 from an external 5V supply?

When you say crash, what actually happens?


 

  When I say crash, I mean the computer shuts down and reboots.

The 7i77 is powered by an external 5vdc supply. Here are some pictures of the wiring 


I am getting 5vdc between the screw labeled vcc and 0vdc. Interestingly, I can start LinuxCNC with the encoder hooked up and it will not crash unless I move the hand wheel. I used halshow to verify other buttons are working (joystick, start, stop, etc.)

power supply for 7i77 is 15w/2.4 amp

OK that sounds more like a hal issue or maybe hardware (Memory?) issues on the PC

Can you post your hal/ini files?

 

here are my hal and ini files. I only have a few buttons working at the moment so it should be pretty generic so far