I am also experiencing the same error; however, your solution did not work for me.
I uninstalled Zone Alarm, this did not correct the problem. I then restarted in SafeMode, which did not work either. I did not have this problem until the last update that occurred on 9-16-2010. This update reset all my personal settings including default
programs, turned off ZoneAlarm, turned off windows defender, and erased all my stored Access points and their pass phrases. When the update installed it automatically rebooted without notice, warning or even a prompt, it just shut down and restarted. Then
there is one other disturbing thing that happened with that update, all the previous restore points were deleted.
Luckily I had just made complete image of the drive on the 15th, so I restored my system from that.
So now I am curious where the problem is. So I setup my trusty old bench machine and start with a clean install of Win7, apply all updates, set a restore pioint then installed four programs and then tried to roll back to the restore point. It did not work.
The only security running was the windows firewall and windows defender, no anti-virus. Tried Safe mode, it still did not work. Hmmmm? I then set FULL PERMISSIONS to everyone at the root of the drive and tried again, but still got the same error. (0x80070005)
Hmmm? NTFS permission problem maybe?
So I dumped that install and started over, but forced an install on a FAT32 partition instead. Applied updates, set a restore point, install 1 program then tried to restore. Got the same 0x80070005 error. For the life of me I can not think of one single
way that a system process could be restricted access to a file on a FAT32 partition.
In the mean time I am starting over over again but not applying any update dated after 7-27-10, this is the last time I know the system restore worked, then I will add one by one until I find the culprit. By the way when I used it on 7-27 I didn't disable
or uninstall anything it just worked without error.