I used this simple little program called MCE standby on Vista to sought out all issues relating to S3 sleep and never had any further problems. There is a beta version you can try for Windows 7. You can get it here
Slick Solutions - MCE Standby Tool (MST).
He also does another program called LEDSdriver which I have working in Windows 7 which uses the power LED on my Antec Fusion case to show when it's recording. You just connect it to the COM1 port on the motherboard. Full instructions are shown on his website and no soldering required. One of the best little applications that really transformed my HTPC!