Logic Pro audio error 10011 (drop out)

I bought a new mac mini yesterday that meets all requirements for Logic. I bought it to run Logic as a dedicated machine linked to a keyboard. Apart from the basic software that came with it, Logic is the only software installed on it. Installed it after I did all the updates. Aiport & bluetooth is now turned off, and I don't have it hooked up to a network.
Brand new, 10.6 factory fresh system, 2gbs ram and 91 GB of pure virgin hard drive space. Doesn't get much cleaner than that.
And it wont run the demo songs without the audio error..... and these are their demos!!! I really doubt they would choose demo songs that are too complex to play, so why the errors?
I tried running through the demos and re-running them. This did help, but one demo is still bawking half way through.
This just does not make sense to me. Is there something I'm missing? I am new to Logic Pro, moving up from garageband. Not sure if this:
'System Overload.The audio engine was not
able to process all required data in time.
(-10011)'
is this what many here refer to as ' dropping out'?
Help!!!!
(ignore Model and machine listed below -different machine)

Hi,
Thanks for your replies. I did move demos to the Hard drive (found out that the hard way!)
The thing is the mini is to be used exclusively for music, and is hooked up to a pro88 midi keyboard. 90% of the time it will be used for Mainstage, with some editing in Logic.
It sure does a fine job with GarageBand - no issues there.
My main machine is a MacPro, and I have three other (older) iMacs. So I really didn't want to spend more than I have to. As the Mac will be only used for music and nothing else (not even internet etc.) I was hoping that it would be up to the task of running Logic, as it does meet the needed specs.
My worry is that moving up to a iMac (which would almost double my investment to $1300) might not necessarily do much. I am not willing to dedicate a big machine like a MacPro to the task -way too expensive for my budget.
So.... being new to Logic, is there a chance settings are the culprit. Is current practice to work on a few tracks, and freeze them, then continue to add new tracks? Or is it more common to leave everything un-frozen when working on stuff?
Options I am aware of are:
•Freeze tracks
•Buffer size set to 1028
anything else?
If the mini is not fully up to the task, would the low end iMac really be any better? or will it to be not up to the task either, in which case there is no point shelling out more. From what I have read, the even the biggest machines stumble from time to time.
Thanks again for your input, I do value it!

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