The game runs fine for me using a 4th gen i7 with a Nvidia Quadro K5000M on Windows 7 Pro, so if I was you I'd re-install Windows 7 and get a fresh start. You shouldn't need to activate Windows if you have a named brand PC (HP/Dell being the bigger brands) that came with Windows 7/8.
Windows version shouldn't matter, it's probably his Windows system needing a fresh start.
Yeah not going to do that , I have no other issues with this machine , this is the first time I have had any issues with a renpy game(or any game for that matter). It seems to be the way that particular exe is written being the other one works fine. I suspect but wanted confirmation , that the exe in the main folder only determines which OS you are running and then points to one of the two OS folders in the Lib folder either Linux or Windows they do not operate in the same way they have totally different Kernels and so the exe's in those folders are specific to the OS in question. All the configurations for graphics and the rest is handled by the second exe. At least that is what it looks like to me.
At this point if that question can't be answered it is not really a big deal just curious , I am playing the game and seems to be working just fine.
So called refreshing the OS unless you have had your boot table wiped out is probably a waste of time in most cases especially with a non supported OS because getting everything updated again is a major pain in the ass not to mention re installing all your programs...
But thanks for trying to help anyway.
Oh and I built this system my self have never bought a name brand system. Building systems is actually pretty easy at least it was in the olden days.