Are you using version 6? If not upgrade - its free.
Using 6, try dragging and dropping or cutting and pasting the bbc iplayer url onto the interlace instead of letting it auto detect. You will then be prompted with all available qualities and sources for that stream.
If your still having issues with 6 please provide a url so we can check it out.
I have the same issue. How do I download the update (6)? Is this for Mac?
You can download from the download menu item above. This is a windows forum.
If iplayer downloads are not working for you, please provide debug logs from when you try and download.
See the sticky post on how to do this.
You could also look at using the DVR capture method which can capture most videos, even copy protected ones.
Here are the results of my testing of iplayer stream capture downloads with 188.8.131.52 using BlackVPN from Australia to the UK.
Test URL: http://www.bbc.co.uk/iplayer/episode/b0675m1j/panorama-trouble-at-the-post-office
Multiple streams detected -
I chose the highest quality and its downloading fine.
when i try that, it says downloading, but never does, and when i check the network bandwidth monitor its not downloading
its working now, but i had to switch it to video download capture method, the drag url onto it stalled download... worked the other way.