Simple construction errors invalid geometry when cloned!

Hi. V5
I am getting invalid geometry occurring on this so simple an object, why ?
Invalid Geometry keeps happening on things, when it does I UNDO THE COMMAND. I will not continue with it now as a loose canon on board !

Here we have a cylinder made by extruding a simple circle drawn using the circle tool, then a wider end piece same method grouped to it as I may need to alter size, so I dont want Boolean Union. One doesnt have to use BU anyway, looks alright and I can alter it. I AM NOT SENDING IT TO ANY MACHINE OR 3D PRINTER !

Then a hole made through it using another circle extruded and boolean differenced. so far so good.
I chamfer edge 0.02 inch the little hole, so far so good, then I do the second edge, invalid geometry flashes on screen, I undo that, try again, same thing so I undo it
I then try to do the end, invalid geometry, so undo it.

I’ll clone it, invalid geometry declared, hells bells ! How can the source be ok yet the clone invalid ?

here it is.

It doesnt get any simpler than that and invalid geometry errors, I have had these on simple things recently, nightmare. it wont let me work.

file deleted as bitmap issue rampant still, major problem.
will be posted when v6 v7 bitmap issue solved. needs McNeel to solve.

I created this file by exporting the pin out from the file it was doing this in, and its still doing it despite it being in a fresh new file, so its brought whatever gremlins with it, and the previous file was made by exporting an object out from the parent file which has 40 or more bitmaps all as PictureFrame. Also if this declares missing bitmaps I AM THEN VERY ANGRY as how can I create a pure file just with an object exported out ? There were no embedded bitmaps, I dont use bitmaps for materials , just for the PictureFrame function . Audit3dmfile shows no bitmaps, so let me know if any bitmaps are flagged up as missing as this is a serious problem for V6 and V7 doing this if so. against my wishes and privacy. There seems no way of stopping it from happening when it didnt in V5. There is no command to red the file for forum posting of looking for bitmaps when opened in V6 or 7.