Windows 7: Volume shadow copy necessary?

I wonder if I should use volume shadow copy on my PC. Is it necessary? Is it typical that it creates many problems?

useful if you or other people mess files up regularly. Here's some reading:
What you should know about Volume Shadow Copy/System Restore in Windows 7 & Vista (FAQ) | Trying To Be Helpful

You need to be a little more specific. Are you just referring to making restore points or the VSS (Volume Shadow Copy Service) in general.

If you use Macrium and presumably many other imaging programs the service is required to be enabled else the imaging will not work, unless I'm mistaken.

Never heard that and don't believe that is true. The whole point of having a drive imaging program is to create full images of any specific drive or of the whole complete system. And then to restore that image to get a farked system back up and running.
Since you really can't do a restore of the whole system, whether just the main boot drive or every drive/partition, while the OS is running the image program can work all by itself without any OS background program running.

I myself only install a imaging program long enough to create boot CDs/DVDs or thumb drives and do all my imaging and restoring from one of those. That way there is nothing getting in the way while creating or restoring a image.

I just looked at my services and I have Volume Shadow Copy set to manual and it isn't running. I have no problem creating or restoring. But then I do all that from a boot thumb drive.

Hot imaging requires VSS or other similar propreitary technology to work. Most imaging programs use VSS including macrium and driveimage for hot imaging. Paragon permits users to select between MS VSS and its own HP (Paragon hot processing) technology to live image as far as I know.

try disabling it, then do a backup. setting services to manual 'turns them on' when needed.

Of course this is correct; my Paragon 2010 even asks which you prefer during set-up.

As a later post pointed out, having it set to manual is 'enabled' as opposed to 'disabled', that is how I found out about the service. I don't use System Restore and was a bit surprised when I started to have problems with Macrium until I realised what I had just changed. Not sure if it applies to other imaging programs though. I always image within Windows and boot from CD to restore. Thank you to all those who have pointed out Macrium as a decent imaging program as it has worked consistently for me as did Acronis on my older XP system.

Including windows 7 image backup. Any imaging backup software that can make a backup on a live system needs to create a snapshot in time of the system. Most do this by making a volume shadow copy.