I am using SDL Trados 2007 Professional running on Windows XP. I am trying to create a new project
You specify that you use the 2007 version, so how do you create a project? Did you do this in Synergy?
At the end of the project creation process when it processes the files and does pre-translation and creates a project translation memory (we have no pre-existing TM for this one) ...
I now reckon you really mean Studio 2009 since automatic pretranslation and "project memory" does not apply to the 2007 version.
However, what puzzles me is that I don't have Tagalog as a language in the language selection of Studio.
So, before we try to diagnose the problem any further it would help if you could tell us exactly what you did using which software.