Resolution
Oddly enough, this error is actually the result of the Project Server
administrator editing the Health Lookup table and removing the value specified
as the Default Value in the Health field. Project Server 2007 does not
select an alternate value as the Default Value for the Health field in response.
Instead, it leaves an invalid value in the Health field, which triggers the
error when a user attempts to save an Activity Plan containing tasks. To
resolve this problem, the Project Server administrator must open the Health
field for editing, select a valid value for in the Default Value field, and save
the Health field.