One of the ridiculous error message from Windows Vista. I had to deal with it a number years ago when Vista was still relatively new. Just had it again a couple days ago on an old laptop server. It happened after receiving a warning about unable to load profile so a temporary one had been used - once logged out, the error started appearing and no login was possible.
The official methods to deal with the error is here. Indeed the first method worked for me this time. However if you look closely, the error is really just a result of Windows mistakenly keeping a temporary profile as the working profile (the path is "Users\temp"), so a manual fix is needed, which is basically restore the .bak profile in registry (and rename the temp one .bak) - but why couldn't the system do it automatically???
No wonder it's said that virtually the whole Vista team was fired.