Be sure you do not log on as System Account if you have SP1 or later service pack installed.
Please use a less privileged account and try again.
See A declarative workflow that is configured to start automatically when e-mail enabled items are created does not start automatically after you install Windows SharePoint Services 3.0 Service Pack 1 (http://support.microsoft.com/kb/953289) for more information.
-lambert
Sincerely,
Lambert Qin | Microsoft TechNet Managed Forum Support
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