Why can't I open a DWG with V8i SS4?

I recently upgraded to SS4 and noticed that one of my referenced DGN files was not found, i.e. red.  I just tried to open the DWG with V8i SS4 and it gives an error message that it is not a recognized file format.  I did not have any issue opening this file with SS3.  Is it worth tracking down an answer, or should I just go back to using SS3?

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