The error: RAM Disk hangs when a Volume Disk or Volume Image is Mounted. If Hard Disk Emulation is selected, RAM Disk mounts and runs without any errors.
This error has occurred for the first time in Windows 10 Insider Build 16226... RAM Disk has worked on all previous Windows 10 Builds.
The error is not related to a corrupt image file. The error occurs with when mounting an existing image file, a new 'just created' image file, and when attempting to mount a new Volume Disk without specifying an Image file.
While using Hard Disk Emulation provides a stable workaround, this looks like it could be an issue for RAM Disk in upcoming releases of Windows 10.
P.S. The Windows 10 error logs did not include any detail. The log entry simply stated that the application hanged.