CRASH running license validation library

In a Windows based application I use a third-party library that performs some license validation. When I run this application without DR, this validation check works fine and the application goes past this check successfully..

When I run the application under DR Control, I experience three exceptions in the application code as follows:

1. An Status_breakpoint exception (0x80000003)
2. An integer overflow exception (0xC0000095)
3. An Single Step Exception (0x80000004)

After receiving the above, the application crashes and I end up with the following DR Crash message:

...
Tool internal crash at PC 0x687a9049. Please report this at your tool's issue tracker. Program aborted.
0x80000004 0x00000000 0x687a9049 0x687a9049 0x00000000 0x00000000
Base: 0x68730000
Registers: eax=0x00000000 ebx=0x00000000 ecx=0x7e1f9af7 edx=0x00002580
esi=0x005deef4 edi=0x6b6d8294 esp=0x005deaf8 ebp=0x005dec44
eflags=0x00000246
version 7.0.17808, custom build
-no_dynamic_options -client_lib 'c:\Test\TestClient32.dll;0;' -probe_api -stack_size 56K -max_elide_jmp 0 -max_elide_call 0 -no_inline_ignored_syscalls -native_exec_default_list '' -no_native_exec_managed_code -no_indcall2direct -no_aslr_dr -pad_jmps_mark_no_trace
0x005dec44 0x6ae39a9c
0x005def5c 0x00000000>

Could you provide some guidance on:

A. Could I be handling exceptions incorrectly?
B. Are the options selected incorrect? I would like to add that I tried re-running with and without the "-no_code_api" switch but that did not help. The exceptions show up exactly the same way. Running without a client did not help either.
C. Is there a way for me to specify for DR to use the code directly from a selected library instead of making a copy in the VMArea? I should mention that I tried using "dr_module_set_should_instrument()" in the client but that did not help in this case

Thanks for your urgent attention to the issue.

SCV