I may not be that much informed person as many guys here but let me try You must be using a cracked version of windows 7 , If you didn't cracked the window by yourself and bought or downloaded the one already cracked by someone else then the person who cracks the windows most of the times makes sure that certain applications that may end up catching your system as non-genuine must not run or installed on your system like in my case the KB971033 is always unchecked during the installing updates functions so it can't be installed accidently ... As far as my little knowledge serves the windows 7 sp1 includes a built in kb971033 so that might restricting it ... And with your installation that must be something to do with corrupt files or unreadable sectors as it happened to me quite few times