It should be possible to watch TV with one capture card and the hybrid/core. You didn't say how you checked that the card worked perfectly? Did you test it with Kaffeine or some other program?
I suggest you check the log file for the mythtv backend (/var/log/mythtv/mythtvbackend.log) to see if there are any errors when starting the live TV. You can also check the MythTV_Player log file (/var/log/pluto/XX_mythtv_player or similar, XX being the device number). Alternatively you can try starting mythtvfrontend in a X console session, to see its output.
Also note that this message is displayed if mythtv is recording a tv show at the time you are trying to watch TV.