I investigated the issue further and it seems that after loading a savestate, the emulation locks up after a few seconds. It doesn't matter if the emulation was paused or not. It happens on r43xx ~ r62xx and 2.0, but apparently other people don't have this problem.
AMD Phenom(tm) II X4 925 Processor 2.80 GHz
Windows 7, 32 bit
ATI Radeon HD 5670
After loading a state, if I save a new state the lock-up doesn't occur. If I save a state and restart the emulator and load it, is is still likely to lock up the emulation, but it takes more time.
If I replace the Dolphin folder and reboot my computer, there is a rare chance that the hanging issue doesn't occur at all (until the emulator's next crash or until I press "left", "down" or "right" (hangs the emulation if used in conjunction with frame stepping)). This is unconfirmed information though as the bug behaves randomly.
I tried TASing knowing that saving a state can cure the hanging issue, but after loading a state, the emulator doesn't receive input for about ~50 frames!
Also, if I load a state&save a new one before a target test level or HRC, the countdown and timer behaves differently. It may go 0.10, 0.3, 0.0 or it may go 0.10, 0.6, 0.0.
May be related to SSBM(PAL) but it certainly makes TASing impossible for me, with and without savestates. At best, I can TAS without rewinding but it leads to results that look worse than human playing.
I wonder how AJP made his AR TASes...
Here is a vid of the hanging issue.
http://www.youtube.com/watch?v=2RPnC0MQjsU