Great post, like everyone, panicked hard when I realized that the msconfig Diagnostic Startup broke my ability to login with a password at startup, thought I bricked my laptop! Your method solved the problem straight-up, only issues I had was not being able to get to the blue recovery screen with the hold-shift, restart-same time method. Had to use the alternate method of forcing restart at boot. Then, instead of the blue screen, was prompted to enter my Windows Key for my laptop. Of course didn't have that written down anywhere, so luckily was able to login into my windows account from my Rasberry Pi and get the key.
Also, the file folders system accessed through the re-image method wouldn't allow .exe files to show on my system. Only "Setup Files" with no option to change to "All Files" when scrolling through the file selector. Easily fixed by finding the right System32 folder using the CMD prompt and DOS commands to do the renaming. Thanks for the info!