Same problem here.  Win 7 64 bit, Picasa 3.8 v 117.43.0 . Used to work like a charm but now will not import pictures from either digital camera I own.  Camera is recognized in Picasa, but get error message either source is unavailable or destination is full or read only.  Reinstalled Picasa no help. Sure, I can import files to computer then into Picasa, but why do I need to go thru all that?  Please get someone to look at this and fix it.  If you need something to work with, there are LOTS OF PEOPLE WITH THIS PROBLEM.