After turning off the battery monitor in several places and still having no success, I think I've tracked this down to a problem with the "Battery Maximizer" feature. What seems to have worked for me is to go into Control Panel -> ThinkPad Configuration -> Option tab -> Customize, and then uncheck the "Add Battery MaxiMiser Guage on Task Bar" option. I'm also on WinXP and a thinkpad T41. Life with litestep is much better now...