I'm sorry, I don't see how to put it in code tags, but here is the code:
rows = gp.SearchCursor(workspace + "\\parcels_ut_town_list.dbf")
for row in rows:
town = row.town
# Create Output Directory
towndir = town.strip()
# Create Output Directory
gp.AddMessage("Processing" + " " + town)
print "Processing" + " " + town
gp.AddMessage("Creating Directory For" + " " + town)
print "creating outfolder for "+town
outfolder = gp.CreateFolder_management(workspace, towndir) ##Sometimes quitting here
expression = "TOWN = " + "'" + town.strip() + "'"
parcels = outfolder + "\\parcels"+towndir+".kmz"
# Process: Make Feature Layer
print "making feature layer" ##-And sometimes quitting around the next line-
arcpy.MakeFeatureLayer_management(parcelsProject_shp, parcelsProject_Layer, expression, "", "FID FID VISIBLE NONE;TOWN TOWN VISIBLE NONE;COUNTY COUNTY VISIBLE NONE;GEOCODE GEOCODE VISIBLE NONE;STATE_ID STATE_ID VISIBLE NONE;MAP_BK_LOT MAP_BK_LOT VISIBLE NONE;PARENT PARENT VISIBLE NONE;PROP_LOC PROP_LOC VISIBLE NONE;PROPLOCNUM PROPLOCNUM VISIBLE NONE;TYPE TYPE VISIBLE NONE;FMUPDORG FMUPDORG VISIBLE NONE;FMUPDAT FMUPDAT VISIBLE NONE;FMSRCORG FMSRCORG VISIBLE NONE;Shape_STAr Shape_STAr VISIBLE NONE;Shape_STLe Shape_STLe VISIBLE NONE;Shape Shape VISIBLE NONE;Shape_ST_1 Shape_ST_1 HIDDEN NONE;Shape_ST_2 Shape_ST_2 HIDDEN NONE")
# Process: Layer To KML
gp.AddMessage("Converting town to KML")
print "Converting town to KML"
arcpy.LayerToKML_conversion(parcelsProject_Layer, parcels, "0", "false", parcelsProject_Layer, "1024", "96", "CLAMPED_TO_GROUND")
#Copy Metadata
gp.AddMessage("Copying parcels Metadata For" + " " + town)
print "Copying parcels Metadata For" + " " + town
shutil.copy(metat, outfolder + "\\" + "parcels.txt")
gp.AddMessage("Done Processing parcels For" + " " + town)
print "Done Processing parcels For" + " " + town
#Create The Zipfile
#gp.AddMessage(output + "\\Parcels_" + towndir)
zpfile = zipfile.ZipFile(output + "\\Parcels_" + towndir + ".zip", 'w')
zpfile.write(outfolder + "\\parcels"+towndir+".kmz", "Parcels_" + towndir + ".kmz", zipfile.ZIP_DEFLATED)
zpfile.write(outfolder + "\\parcels.txt", "Parcels_" + towndir + ".txt", zipfile.ZIP_DEFLATED)
zpfile.close()
#Delete Uncompressed Files
shutil.rmtree(outfolder)
gp.AddMessage("All Done Processing" + " " + town)
del rows