The first thing that we need to do is to Narrow down the Issue, we need to make ourselves clear whether it is a camera issue or App glitch that is causing the camera to throw the errors. In order to do so, the following steps need to be followed.
Having your S.D Memory card inserted into the Xperia x10, Go To Main Menu and Click on Settings, Open Storage, Tap "Unmount SD Card", by this the SD card should be unmounted. Now Access the camera application, if you are able to access the Camera and view the photography with out the error messages "Unknown Error and Camera Not Available Error", it clearly states your camera(hardware) is functioning fine.
Now the real thing that we need to do, I recommend doing the Factory Reset of the Phone before actually getting into the resolution, Following are the steps to Do So.
Menu > Settings > Privacy > Factory Data Reset ( Note: this will remove all data from the handset but will not touch a memory stick or SIM card)
- Got to Phone Main Menu
- Click On Camera Icon
- As You tap the Camera Icon, It take 2 or 1 Second to Load the Camera Screen
- As soon as you Enter the Camera Screen, Tap the Available Photos/Videos that were previously shot or available
- Accessing of the earlier Files, should be immediate, as you enter the Camera Screen
- Your Camera Should Work Fine Without the Unknown Error and Camera Not Available Error Messages
- Check the Attached Screenshots For your Reference on Xperia x10 Camera Errors and Problems
Though this seems to be Software Glitch, this should be probably fixed in the coming versions, keep your eyes on Sony Ericsson Software Update Service.
I Encountered this problem after updating My Xperia To Android 2.3.3, Post your successful experiences through the below Comments section