Windows 7: Acer Aspire Stuck on setup is starting services

So one evening my laptop randomly restarted itself and upon logging back in I found that I could not run almost any of my programs (.exe files). I tried checking for anything unusual in the registry but found nothing. In task manager when I clicked a program or attempted to run it in various ways I would see it pop up for a second before it got killed.

Finding no way of fixing it online I decided I would attempt the factory restore option that comes with the laptop in the system recovery that places all your documents in a C:Backup file. But nearing the end of this an error came up saying 'setup is starting services', which says to restart the computer to continue. But I can no longer get it past this screen. I've tried rebooting it in safe mode as well.

Any help is much appreciated! I don't even particularly mind if I lose my information at this point I just need a working laptop...

Do you make your Acer Recovery Disks?

Manual how to use Acer eRecovery Management here:
ftp://ftp.support.acer-euro.com/notebook/empowering_technology/NB%20ET2%20user's%20guide/Acer%20eRecovery%20Management%20English.pdf

I did not unfortunately and since I cannot get into my computer can't make one. My friend suggested I find one online and burn it on a dvd but I'm not sure where to find one...

You can Order Acer recovery disks from here:
https://secure.tx.acer.com/RCDB/Main.aspx?brand=acer

Would that CD ensure that I could restore my laptop to its factory settings then? The error would go away after?

If you have no hardware problems, yes.

I had the very same problem with my dad's new laptop.
The laptop was rebooting by itself and I tried to restore, using the option that creates a backup on the C-hard disk.
Thats what I shouldn't have done. Instead I should have chosen the reset all factory settings (without backup).
And there is no need to buy a recovery disk. Your laptop already has a recovery "hidden" partition and thats the reason you can restore your laptop in the first place. A recovery disk is important but would be used only when that recovery partition has failed or been damaged.

I found that when the laptop is rebooting, and you see the acer logo, you have to press "alt" and "F10" simultaneously to have the options to restore your computer again(the very same place where you chose the restore options). There, choose the "restore all factory settings" and it will take a bit of time but your laptop will be as new as it was first bought.

I know your post is a longgg time ago, but since we encountered the same problem I wanted to share what I learnt while trying long to fix that problem.

1) On the same error screen press SHIFT+F10 and it will open up a black Window. (a command prompt window) 2) In the black windows type the word "regedit"(without the inverted commas and hit enter. That will open the registry editor. In the Registry Editor.. Browse to.... HKLocal machine/SYSTEM/SETUP/STATUS/ChildCompletion, and after highliting childcompletion,on the right hand side check for setup.exe. if the value is 1 change it to 3.(by double clicking on setup.exe and changing the value shown in the box). Then close the registry editor and then also close the black window. Then click on OK for the error and the computer will restart and the installation may complete. just try it and let me know if it worked.

Thank you so very much diamonded (above post), it has helped me and I hope it'll help others too.

This worked for me, thank you very much.