System Protection - Turn On or Off

Good Afternoon "Brink",
I tried to follow the procedure you specified but hit a problem. At instruction 3, I clicked it and got a windows window asking if I am allowing windows to make changes. I clicked "Yes". I then got the Systems Properties window but at the same time got an error window saying "There was an unexpected error in the property page. System Restore encountered an error. Please try to run system restore again. (0x81000203). I did try again but got the same error. If I clear the error window and look at the Properties Window, and under tab System Protection, I note that it stays searching for a drive - but never finds one. I did do a check on "Volumn Shadow Copy". I found it set to "Manual" and switched off. I changed it to "Automatic" and started it. Did a reset and tried again, but the error message etc was still there.

Dear Shawn,
Thanks for your suggestions (option 1 and 2). Neither solved the problem.
With option 1, I followed your good instructions with ease. However; on going back to the System Properties window, I got the same error message as before, and again, under the protection tab windows was not finding any drives to select from. It should surely have found "C" (my internal HDD)
With option 2. You did not specify how to find the "Local Group Policy Editor". I googled and found that you had to run "gpedit.msc" I tried that but it did not seem to be on the computer (Windows 7 Home Premium 64 bit, using Internet Explorer 9)
Further advice would be welcome
Regards from Ron

Yes I did try the reg download, but as I said, I still got the same error report.
I will look again at option 2 as soon as I get a few minutes to spare.

Good Evening Brink,
I am currently using the trial version of AVG Internet security 2011. I'll try disabling or uninstalling it tomorrow. I normally only use the AVG free Anti-virus, along with Super Anti Spyware and Malware bytes (both free versions)

Thanks Brink,
I did disable AVG and try for a "backup now" but it would not do it (error code 0x81000031).
If I have to re-install; how is that achieved? I never had an installatiion disc when I purchased my laptop 6 months ago. However; when I had had the machine a month I did do a back up onto a set of 3 DVDs. It was called "recovery Discs" or "factory default". A month after that I did a further backup on a recently aquired external HDD (WD Elements). This was called "Create System Image". I understand that it is also possible to make or download an emergency repair program which is supposed to fix lots of errors. What do you advise?