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Problems with Win7 User Profile Service

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I am having some issues with my daughter's laptop. Evidence points to an issue with the User Profile Service. The machine is a Dell Inspiron 1545 running Windows 7 Home Premium 64bit, manufacturer installed.

Our problems first surfaced when trying to upgrade iTunes to version 10.1. Install process stalls when trying to install Quicktime as part of the total iTunes download package. All other utilities preceding Quicktime seem to install OK. Since it chokes during the Quicktime install, it never actually gets to the iTunes install.

The specific step that fails is "Computing space requirements" for Quicktime. We get the error "Could not access network location %APPDATA%\." We have tried many of the fixes suggested by sources identified by Googling the error message including those in KB886549. Nothing has worked so far.
We even spent a couple hours on the phone with Apple support, who eventually gave up and said it was a Microsoft problem.

While trying to implement some of the suggested fixes, we encountered some other problems which lead me to conclude that the problem lies in the User Profile Service. Specifically, we are unable to successfully create any new user accounts. When we try, it appears to be created and an icon appears on the login screen, but when you try to login you get the message "The User Profile Service service failed the logon. User profile cannot be loaded." Also, when logged in as one of the existing users, some websites cannot be accessed and favorites cannot be accessed or added.

Fully updated Norton 360 does not identify any issues beyond the occasional tracking cookies.
I have not yet downloaded or run any other Antivirus or Malware tools.

I have run the OTL program and have the log files available if they will help diagnose and resolve these issues.

I appreciate any and all suggestions at this point. This has been ongoing for a while and has become quite frustrating trying to solve.

Thanks in advance.

Edited by ddlong131, 13 January 2011 - 01:49 PM.

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