You shouldn't have had to explicitly replace the cryptolib, as it is now included in the kernel patches. However, I doubt this is related to the issues.
Did you run the vcredist.msi that comes with the new kernel, as per Note 1553465? The symptoms you'd experience if you hadn't are a bit different than you describe, but still it's something to check. This is specific for the EXT kernel on Windows. This one has bitten me in the past.
Besides S Sriram's recommended Note, the other one with important information for upgrading to 721 kernel is 1716826. Still, I don't think this specifically addresses your issue; just dotting the i's.
It may be worthwhile to drop back to 720_EXT as an experiment to see what it does. If the problem goes away, that pretty much isolates it to something wrong with the kernel. If it doesn't, then something else is the cause. The 721_EXT kernel should work fine for you, though, and is generally recommended.
Regards,
Matt