Are they complete seperate installations are are they maybe sharing the tikiroot/lib/ folder. If the 1.8 was a 1.7 upgrade the Smarty/ path moved to inside lib/ as well?
Its a strange one, I have 1.7.4/.5/1.8 and HEAD all on my webserver with various clients sites and never had something like this. (Red Hat 9)
My workstation is a Fedora Core, I'll check on that as that also has my development branchs on it, but again, Ive never seen or noticed anyone with this problem.
Actually! I have had a Tiki bring down a computer with similar effects, no response to anything and then the Out of Memory errors, but that was due to clicking on rebuilding thumbnails in the Image Gallery (RH9 machine)