hyperref problem in 2.9

After postponing this for quite a while, I finally had to switch to MikTeX
2.9 (from 2.4). As I feared, things that used to compile OK stopped working.
I managed to track (one of) the problems to hyperref. Here is a minimal
example:

\documentclass{article}
\usepackage{hyperref}
\begin{document}
foo
\end{document}

The file compiles but is not viewable in YAP 2.9.4148, which keeps
complaining (at each page) about PS specials that couldn't be rendered.
(The report is at the end of this message.) Accidentally, if there are
hyperrefs in the file, they are not seen in YAP either. I tried all
hyperref's drivers I could think of, but to no avail. Does anyone have an
idea how to handle this problem and make hyperref use YAP specials (EXCEPT
using the draft mode, which makes the whole idea of hyperref useless)?
(Forgot to say: when viewed in a text editor, the dvi file does look more
like a piece of postscript, with very few non-postscript insertions.)

Thanks in advance,
Alex

Here is YAP's report:

MiKTeX Problem Report
Message: Some PostScript specials could not be rendered.
Data: Error: /undefined in H.S
Operand stack:
   --nostringval--   PermitFileReading   --nostringval--   PermitFileWriting
--nostringval--
Execution stack:
   %interp_exit   .runexec2   --nostringval--   --nostringval--
--nostringval--   2   %stopped_push   --nostringval--   --nostringval--
--nostringval--   false   1   %stopped_push   1914   1   3   %oparray_pop
1913   1   3   %oparray_pop   1897   1   3   %oparray_pop   1787   1   3
%oparray_pop   --nostringval--   %errorexec_pop   .runexec2
--nostringval--   --nostringval--   --nostringval--   2   %stopped_push
--nostringval--
Dictionary stack:
   --dict:1166/1684(ro)(G)--   --dict:0/20(G)--   --dict:80/200(L)--
--dict:95/300(L)--   --dict:17/200(L)--
Current allocation mode is local
MiKTeX GPL Ghostscript  9.00: Unrecoverable error, exit code 1

Source: Libraries\MiKTeX\Dvi\Ghostscript.cpp
Line: 372
MiKTeX: 2.9
OS: Microsoft Windows 7 Business Edition, 32-bit Service Pack 1 (build 7601)
Invokers: explorer/WinEdt
SystemAdmin: no
PowerUser: no
Root0: C:\Users\Alex\AppData\Roaming\MiKTeX\2.9
Root1: C:\Users\Alex\AppData\Local\MiKTeX\2.9
Root2: C:\ProgramData\MiKTeX\2.9
Root3: C:\Personal\texmf
Root4: C:\texmf
UserInstall: C:\Users\Alex\AppData\Roaming\MiKTeX\2.9
UserConfig: C:\Users\Alex\AppData\Roaming\MiKTeX\2.9
UserData: C:\Users\Alex\AppData\Local\MiKTeX\2.9
CommonInstall: C:\texmf
CommonConfig: C:\ProgramData\MiKTeX\2.9
CommonData: C:\ProgramData\MiKTeX\2.9


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