I had this same problem. I finally tied it to my using Revo Unstaller to clean up some unwanted programs. I picked up a reference to Windows Live Essentials from an error log another member posted to this forum. I used Revo to reverse the uninstall of WLE and the Restore Point VSS problem immediately disappeared.
Your/this post just solved my restore VSS problem!!!!!! Revo turned out to be the culprit in my case as well.
I used Revo to uninstall Roxio Creator Pro 2011 this morning and after the reboot to "remove files leftover files on next boot" my Network Meter gadget and currency converter gadget both stopped working and turned pink.
I spent all afternoon trying to figure the pink gadget problem out. Was gonna do a restore but Went to create a restore point before doing the restore and I got the VSS error.
Realizing that part of Roxio is somthing called BackOnTrack which has something to do with backup that I have never used, I figure another program that has something to do "backup" could have somthing to do with it.
I the did the "reverse uninstall" of Roxio 2011 and was able to create the restore point and my gadgets are back to normal and working.
Theres is also no need for me now to revert to a previous restore point and mess with updates I have done while trying to solve this problem.
Now I just need to figure out how to remove Roxio 2011 again w/o messing things up. Perhaps with the regular add/remove programs and skip Revo on this one........
Quote