So, I got it to work temporarily. Uncheck all the audio settings, closed it and started over again. Checked Focusrite in and out, started a new song and played some audio and it worked great. Saved song, closed Cakewalk. Open Cakewalk, load song, and back to the error.
However, if I disable the audio in preferences, exit program, come back and re-enable, I can get going again and be running fine until I close the program. A workaround for now as I evaluate the program.
Here is a video showing the whole process and what it's doing. I can almost live with this if I don't run into other stability issues. https://www.dropbox.com/s/9hdz3mg9gv7aeqq/Cakewalk Workaround.mp4?dl=0