Group Policies not applied to single pc on domain - client side extension error 8196

Certain Group Policies are not being applied to a windows 7 64 client; only this pc seems to have this problem so far. This started this morning. When trying to add a printer the error message displayed is: Windows can not connect to the printer. Operation failed with error code 0x00000006. When logging in, the usual legal disclaimer is not displayed. On client an RSOP says "Default domain group policy not applied"

Error message in the Application event log on domain controller after running Client-Side Modeling: The client-side extension caught the unhandled exception '0x00000000C0000005' inside: 'threadEntry : client main' See trace file for more details.

On the client:

• Checked services - ok
• Checked firewall - off
• Checked group policy; computer is member of correct container
• Logging off, provides only "other" user available
• Did not prompt for dislaimer after restart
• Removed PC from domain/re-added to domain, double-checked pc is in AllComputers\Workstations container – ok - ran gpupdate /force - no effect
• Attempted to run hotfix 976399 – is not applicable to your computer

Group policy modeling produced the following:

Component Name Status Group Policy Infrastructure Success Folder Redirection Success Group Policy Drive Maps Failed Group Policy Drive Maps failed due to the error listed below and failed to log resultant set of policy information.

Additional information may have been logged. Review the application event log on the domain controller on which the simulation was run for events between 10/17/2012 12:13:14 PM and 10/17/2012 12:13:14 PM.
Group Policy Printers Failed Group Policy Printers failed due to the error listed below and failed to log resultant set of policy information.

Additional information may have been logged. Review the application event log on the domain controller on which the simulation was run for events between 10/17/2012 12:13:14 PM and 10/17/2012 12:13:14 PM.
Group Policy Registry Failed Group Policy Registry failed due to the error listed below and failed to log resultant set of policy information.

Additional information may have been logged. Review the application event log on the domain controller on which the simulation was run for events between 10/17/2012 12:13:14 PM and 10/17/2012 12:13:14 PM.
Group Policy Shortcuts Failed Group Policy Shortcuts failed due to the error listed below and failed to log resultant set of policy information.

Additional information may have been logged. Review the application event log on the domain controller on which the simulation was run for events between 10/17/2012 12:13:14 PM and 10/17/2012 12:13:14 PM.
Internet Explorer Branding Success Internet Explorer Zonemapping Success (no data) Registry Success Scripts Success

Any ideas?

We couldn't find anything specific to nail down the source of the problem. Backed up and re-imaged machine as a resolution.