That's a new error. The simplexml_load_string function is a part of PHP5. I know you have at least PHP5 because there's a whole host of others errors you'd get before that one if you were on PHP4.
Simplexml is an extension added into PHP5 for XML parsing. It's enabled by default, but appears to be disabled on your server. The only suggestion I have is to talk with your technical person or hosting company to see if they can enable it.
The link below is PHP5's description of Simplexml and that's its normally enabled.
<!-- m --><a class="postlink" href="
us.php.net/manual/en/simplexml.installation.php">
us.php.net/manual/en/simplexml.installation.php