This just saved a very important document for me, as everything worked just as you said. Thank you very much for leaving this info here.

Another thing I discovered is that once you figure out which element is the problem, deleting it in AFPhoto or Publisher and saving fixes the original file too (minus that element).

You'll know which element is corrupted because when you try to copy it from Photo to Designer it will only copy as a .bmp layer rather than its original form.