How does it fail? Just no response on selecting the menu item?
Try open Console.app and look for output there.
This is what I find in Console.app:
6/25/09 9:07:27 AM TextMate[745] loadPlugIn: Dialog plug-in with same bundle identifier (com.macromates.dialog_plug-in) already loaded
Have no idea if it's relevant to the 'Edit in TextMate' issue.
I apologize for me earlier empty post; too quick on the trackpad.
J.