I have just uploaded Dates to iCal 2.2.5. This update makes Dates to iCal OSX Lion compatible and I recommend all users update to this version before installing Lion.
For those who have Dates to iCal installed and have already updated to Lion, I suggest you do the following:
1. Replace your previous version of Dates to iCal with version 2.2.5.
2. Open iCal and delete the calendars associated with Dates to iCal.
3. Quit and re-open iCal.
4. Make new calendars to contain the Dates to iCal events.