is it a "STANDALONE" computer or network connected workstation/PC.
Its not uncommon for networked PC's to have startup folders disabled by Administrators for obvious security issues. Maybe a possible security policy in place
Your error picture may be indicative of that.
It cannot install because the folder it wants to use is not there although it is there by default on a standard windows 7 install.
If you have another PC that is not used at that location (friends personal computer) maybe try it on there ?