I just upgraded to Moodle 1.8.1+ (2007021510) and am still having this same problem; I cannot delete an existing course. There are no errors, the browser does not churn (and says 'Done' at the bottom), and it just sits there and does not perform any action beyond displaying "Deleting MYCOURSE" on the page.
If I put Moodle into DEVELOPER debugging mode, I get this after confirming that I want to delete the course:
XML Parsing Error: no element found
Line Number 116, Column 1:
If I put Moodle into ALL debugging mode, I get this after confirming that I want to delete the course:
Warning: assignment_delete_instance(/home/httpd/vhosts/httpdocs/moodle/mod/assignment/type/AU/assignment.class.php): failed to open stream: No such file or directory in /home/httpd/vhosts/httpdocs/moodle/mod/assignment/lib.php on line 1667
Fatal error: assignment_delete_instance(): Failed opening required '/home/httpd/vhosts/httpdocs/moodle/mod/assignment/type/AU/assignment.class.php' (include_path='.:/usr/share/pear') in /home/httpd/vhosts/httpdocs/moodle/mod/assignment/lib.php on line 1667
I'm not sure about the XML error at the top, but obviously this other error is due to a non-existent assignment type that is breaking the deletion process. I tried to go into the course and delete those assignments, but after hitting delete, I would just get a blank page in Moodle. As a last resort, I went ahead into the database and removed the relevant items from the assignment submissions and the assignments tables and was then able to go back into the course and delete those assignments.
After that, I went back to delete the course and it worked. So, we know what was hanging it up. Is there no way to force a course to be deleted, even if it contains non-existent items like this now?