I'm not using any custom startup code, and nothing changed after trying your suggestion. I also tried fiddling with the settings in Preferences -> Parallel, to no avail.

I guess it's time to file a bug report, since there doesn't seem to be anything obvious I'm doing wrong.

That's a good point. I tested it on V9 and had no such problems, the iteration ran up to 1000 without a crash. The problem seems isolated to V10; however, since I need the FEM package, I unfortunately don't have the option of using V9.

I also noticed that V9 is detecting 8 processor cores on my machine, whereas V10 detects 4 (which affects the number of kernels started by default). I'm using a quadcore processor with two threads per core, so apparently V9 is detecting virtual cores whereas V10 detects physical cores.