Hello ashleynt. Welcome to the forum.
It would help greatly if we knew what the issue was that caused you to decide to try and reset the factory settings.
But it sounds like what happened was that the factory restore failed (the CD restore method is notoriously problematic) and Windows is corrupted. So we need to work on repairing that now.
First, (assuming you did not create a Windows 7 Repair Disk) do you know anyone who has Windows 7 installation disks? We may need either a repair disk or the installation disks to fix this.
You could also find someone running Windows 7 and create a Repair Disk on their computer. I'm guessing that laptop had the 32 bit version of Windows 7 on it, if so then you need to create the Repair Disk from another computer running the 32 bit version of Windows 7.
Also, do you know if there was a Acer Recovery Partition on the laptop?
Post back and let us know what you have.