Cannot Complete System Restore

Try this:
1. Set your BIOS so that it uses the DVD drive as its primary boot device.
2. Boot the machine with your Windows 7 Repair CD.
3. Press a key if prompted to boot from the DVD.
4. Select "Safe Mode Command Prompt" when prompted.
5. Log on as Administrator if prompted.
6. Select Repair when prompted.
7. Select System Restore when prompted.
8. Set Windows back to a point before this problem occurred.
9. When finished, remove the CD before rebooting the system.
In Step 2 you could also use your Windows 7 installation DVD. The subsequent steps are similar to the ones above.

You can restore your registry files manually to an earlier point by going through the steps outlined below. The process is involved and requires some careful typing. Ask a computer-savvy friend to assist you if you lack experience in this area. Note that it may reset your password to an earlier value.
1. Keep tapping F8 during the early boot phase.
2. Select Repair from the menu.
3. Log on as Administrator if prompted.
4. Select Repair when prompted.
5. Select the Command Prompt.
6. Identify the correct drive letter for your Windows installation. It could be a drive other than C: but it won't be X:. You do it by typing the commands
    dir C:\Win*
    dir D:\Win*
    dir E:\Win*
    until you find the Windows folder.
    I will call that drive "Q:".
7. Type these commands:
    cd /d Q:\windows\System32\config
    xcopy *.* Q:\RegBack\
    cd RegBack
    dir
8. Examine the dates of the Software, System and SAM files. Were the files created before or after your problem became apparent?
9. If they were made before the problem became apparent then you can type these commands:
    copy /y software  ..
    copy /y System  ..
    copy /y Sam ..
    (the two dots are part of each command)
10. Reboot normally. If things do not work out then you can backtrack by copying the original registry files from Q:\Regback to Q:\Windows\System32\config.