For whatever reason, itunes is crapping out because of Windows Service Pack 2. The trick to fixing this problem is by going into the CONTROL PANEL and then go to ADD/REMOVE PROGRAMS and uninstalling Windows Service Pack 2. When your finished restart and then reinstall itunes. You should have no problem.
Next load up Internet Explorer and go to TOOLS, WINDOWS UPDATE. Go through the windows update process and reinstall any updates you may need.