You can modify Destination User for the InfoPath client event by right-click on the Activity containing the infopath client event > select Properties > click on Destination Rule (people icon). From there you can modify the destination user. See the k2 documenation for more information on Destination Rule:
http://help.k2.com/helppages/k2blackpearl1420/webframe.html?page=B2.2_Reference_-_Destination_Rule.html
Thanks for your reply!
I can see/add/modify the destination user in the activity properties.
The issue is I am still getting the error saying "An activity with a client event must have a destination user".
The error comes only when the destination user was added from a client event wizard configured for the first time.
As a workaround what I do is I create an activity assign it a destination user and then add an event to the activity.
The other way around does not work.
I hope I could explain the problem and the workaround. It would be beneficial to know the cause/solution to it.