The latest fix: change 'log on as' to Local System Account in services window for WMPNSS.
-Open the task manager. (ctrl+alt+del)
-Go to the Services Tab.
-Click on the Services button and minimize task manager.
-In new Services Window, right click on Windows Media Player Network Sharing Service.
-go to Log On tab.
-if Local System Account is not highlighted, then you've most likely found the problem. Select Local System Account radio button, click Apply and OK, then right click on Windows Media Player Network Sharing Service again and select restart service.
Your xbox 360 should now automatically see your vista pc.
if not, try deleting the files in c:/ProgramData/microsoft/windows/drm, and restarting Windows media player.
This worked for me after I tried literally everything else. Thanks a lot! I registered just to reply to this! It's been driving me bonkers!