Found this info but please wait until some other ABer gives an answer
It may be possible to fix the damaged System Restore files. Click Start -> Programs -> Accessories -> MS-DOS Prompt. Now type the following three lines, pressing [Return] between each:
cd system
cd restore
rstrui.exe /makefirstrestorepoint
Close the Command prompt window and restart your PC - System Restore should hopefully now work. If it doesn�t, you�ll need to use your back-up CD to get Windows back to its original version.