Just change OutFile=ships.bm2 to OutFile=ships.lvz mapobjects and screenobjects sections are not needed since you don't have any. Just recompile that lvz and it should work. Oh, delete the ships.bm2 file in your Continuum\Zones\yourZone folder; you can clear it from your server directory as well. That's what freezing it... Cause you had it get a file called "ships.bm2", but that file is not a valid graphics file, it's a lvz file, so Continuum brain-farted. In your arena settings, you need to use Misc:LevelFiles=nameOfTheLVZ.lvz