I finally got it sorted thanks to G_crum who posted a solution on BH forums!
I followed his instructions so I installed Libxml Fix Plugin and then modified the plugin code
From:
LIBXML_DOTTED_VERSION == ‘2.6.27’
To:
LIBXML_DOTTED_VERSION == ‘2.6.26’
Which was my libxml version and it worked on both my single wordpress blog and wordpress mu installation. I hope it helps.
