This happens when a player or player(s) have a bugged peice of equiptment i will not go into details on what causes it or how to fix it because you wouldn't understand anyway lol.
To temp fix the problem you need to modify your source to print player name and packet id to console with errors so you know exactly who is throwing the errors rather then the general one your getting now that tells you nothing then go to that person and find out what item there usin is bugged and destroy it and make them a new one.
Here is a example of what i am refering to..And will aid you in fixing your errors better in the future and what packets are doing it, Let me load up this garbage of a source your using real quick and add a try/catch to it and grab the first error i can force it to do ( shouldn't be hard ) lol
Code:
Character name: Tw3aktest / PacketID: 1022 / System.NullReferenceException: Object reference not set to an instance of an object.
at COServer_Project.Character.Attack() in C:mypathsourceTCWNN SourceCharacter.cs:line 2553
As you can see the console prints out what character is throwing the error and what packetid, this was the first error i got it to throw which isn't your same one but is just a example as how it can be done for future error handling to make it a bit easier for you...If you don't know how to do this don't ask
You really shouldn't be using TCWNN for a release source anyway as alex is very poor at c# and uses alot of bs code that isn't done right and eats memory usage and cpu for no reason..There is nothing done right in this source at all that he added you can learn from infact you will only learn how to code things improperly in c# using this source or any LOTF source for that matter.