Group policy printers not deploying - insufficient system resources

We have our Staff printers policy applied to our Staff users OU. This policy has ~60 printers deployed as Shared printers via Preferences.

All bar 2 of these printers are item level-targeted to OUs or security groups containing computers. The remaining 2 printers are our large copier devices which every member of staff has access to.

This policy works nicely across the school and has been working for some time. Today however I have spent a solid number of hours trying to diagnose an issue on 1 laptop. Basically, the printer doesn't deploy.

I ran gpresult /H to find that the printer in question (an item level-targeted printer called Chemistry office printer) is being applied by the GPO but isn't being deployed because of error code 0x800705aa.

Upon investigation in Event Viewer, the following Warning is listed with Event ID 4098:

The user 'Chemistry office' preference item in the '~ Staff printers {9FA009B1-9330-4CF9-878E-82E597F491D9}' Group Policy object did not apply because it failed with error code '0x800705aa Insufficient system resources exist to complete the requested service.' This error was suppressed.

Originally this error was also occurring on the 2 large copier devices. We then removed the machine from the domain, renamed it and re-added it to the domain. The large copier devices then appeared but the Chemistry printer didn't - because I had forgotten to put it into the security group. We added the machine to the security group then gpupdate /force'd and rebooted the machine. That's when the error above reoccurred but on the Chemistry printer this time instead.

I've checked the system resources on the machine itself, all 3 of our DCs and both print servers. None of them have less than 30% memory available and all have hundreds of Gb of HDD space.

I have rebooted the machine a number of times. It is running Windows 7 and is up to date with Windows Updates obviously including SP1. All of the diagnosis work has been done on an ethernet cable with the wireless adapter temporarily disabled.

Most importantly, I have Googled the error codes - but I can't find any sites which mention both Event ID 4098 and error code 0x800705aa.

Can anyone offer suggestions for further diagnosis?