failure to create a DirectX device and swapchain

Try not passing a pointer to your HWND through. You should pass an HWND as a non-pointer. Other than that I don't see anything massively wrong.

This is what DXErrorLookup says about your error:

HRESULT: 0x887a0001 (2289696769)
Name: DXGI_ERROR_INVALID_CALL
Description: The application has made an erroneous API call that it had enough 
information to avoid. This error is intended to denote that the application should be 
altered to avoid the error. Use of the debug version of the DXGI.DLL will provide run-
time debug output with further information.
Severity code: Failed
Facility Code: FACILITY_DXGI (2170)
Error Code: 0x0001 (1)

So have you considered using the debug version of DXGI to see what the error is?

Btw my working DX10 initialisation is as follows (Warning a LOT of code!):

    HRESULT hr  = S_OK;

    // Wrong init params passed in.
    if ( pParams->paramSize != sizeof( D3D10InitParams ) )
        return false;

    // Upgrade the initparams to the correct version
    mInitParams = *(D3D10InitParams*)pParams;

    // Create factory.
    IDXGIFactory* pFactory  = NULL;
    if ( FAILED( CreateDXGIFactory( __uuidof( IDXGIFactory ), (void**)&pFactory ) ) )
    {
        return false;
    }

    if ( FAILED( pFactory->MakeWindowAssociation( mInitParams.hWnd, 0 ) ) )
    {
        return false;
    }

    HWND hTemp;
    pFactory->GetWindowAssociation( &hTemp );

    // Enumerate adapters.
    unsigned int count  = 0;
    IDXGIAdapter * pAdapter;
    std::vector<IDXGIAdapter*> vAdapters;
    while( pFactory->EnumAdapters( count, &pAdapter ) != DXGI_ERROR_NOT_FOUND )
    {
        vAdapters.push_back( pAdapter );
        count++;
    }

    unsigned int selectedAdapter    = mInitParams.display;
    if ( vAdapters.size() > 1 )
    {
        // Need to handle multiple available adapters.
    }

    // Release all other adapters.
    count   = 0;
    unsigned int max    = (unsigned int)vAdapters.size();
    while( count < max )
    {
        if ( count != selectedAdapter )
        {
            vAdapters[count]->Release();
        }
        count++;
    }

    // Device should support all basic DX10 features.
    // Caps does not support enough basic features.
    //if ( !CheckCaps( &caps ) )
    //  return false;

    // Create the D3D 10 device.
    DXGI_MODE_DESC dxgiModeDesc;
    dxgiModeDesc.Width                      = mInitParams.width;
    dxgiModeDesc.Height                     = mInitParams.height;
    dxgiModeDesc.RefreshRate.Numerator      = (mInitParams.refreshRate == 0) ? 60 : mInitParams.refreshRate;
    dxgiModeDesc.RefreshRate.Denominator    = 1;
    dxgiModeDesc.Format                     = DXGI_FORMAT_R8G8B8A8_UNORM;
    dxgiModeDesc.ScanlineOrdering           = DXGI_MODE_SCANLINE_ORDER_PROGRESSIVE;
    dxgiModeDesc.Scaling                    = DXGI_MODE_SCALING_CENTERED;

    DXGI_SAMPLE_DESC dxgiSampleDesc;
    dxgiSampleDesc.Count            = 1;
    dxgiSampleDesc.Quality          = 0;

    //DXGI_USAGE dxgiUsage;
    //dxgiUsage.

    DXGI_SWAP_CHAIN_DESC dxgiSwapChainDesc;
    dxgiSwapChainDesc.BufferDesc    = dxgiModeDesc;
    dxgiSwapChainDesc.SampleDesc    = dxgiSampleDesc;
    dxgiSwapChainDesc.BufferUsage   = DXGI_USAGE_RENDER_TARGET_OUTPUT;
    dxgiSwapChainDesc.BufferCount   = 2;
    dxgiSwapChainDesc.OutputWindow  = mInitParams.hWnd;
    dxgiSwapChainDesc.Windowed      = mInitParams.windowed;
    dxgiSwapChainDesc.SwapEffect    = DXGI_SWAP_EFFECT_DISCARD;
    dxgiSwapChainDesc.Flags         = 0;//DXGI_SWAP_CHAIN_FLAG_ALLOW_MODE_SWITCH;

    // Set the device as a debug device when compiled for debug.
#ifdef _DEBUG
    unsigned int flags  = D3D10_CREATE_DEVICE_DEBUG;
#else
    unsigned int flags  = 0;
#endif

    mpAdapter   = vAdapters[selectedAdapter];
    // Create the device and swap chain.
    if ( FAILED( D3D10CreateDeviceAndSwapChain( mpAdapter, D3D10_DRIVER_TYPE_HARDWARE, NULL, flags, D3D10_SDK_VERSION, &dxgiSwapChainDesc, &mpSwapChain, &mpDevice ) ) )
    {
        return false;
    }

    // Get the back buffer.
    ID3D10Texture2D* pBuffer    = NULL;
    if ( FAILED( mpSwapChain->GetBuffer( 0, __uuidof( ID3D10Texture2D ), (void**)&pBuffer ) ) )
    {
        return false;
    }

    // Create the default render target view.
    hr = mpDevice->CreateRenderTargetView( pBuffer, NULL, &mDefaultRenderTarget );
    pBuffer->Release();
    if ( FAILED( hr ) )
    {
        return false;
    }

      // Create depth stencil texture
    D3D10_TEXTURE2D_DESC descDepth;
    descDepth.Width                 = mInitParams.width;
    descDepth.Height                = mInitParams.height;
    descDepth.MipLevels             = 1;
    descDepth.ArraySize             = 1;
    descDepth.Format                = DXGI_FORMAT_D24_UNORM_S8_UINT;
    descDepth.SampleDesc.Count      = 1;
    descDepth.SampleDesc.Quality    = 0;
    descDepth.Usage                 = D3D10_USAGE_DEFAULT;
    descDepth.BindFlags             = D3D10_BIND_DEPTH_STENCIL;
    descDepth.CPUAccessFlags        = 0;
    descDepth.MiscFlags             = 0;
    if ( FAILED( mpDevice->CreateTexture2D( &descDepth, NULL, &mpDepthStencilTex ) ) )
    {
        return false;
    }

    // Create the depth stencil view
    D3D10_DEPTH_STENCIL_VIEW_DESC descDSV;
    descDSV.Format              = descDepth.Format;
    descDSV.ViewDimension       = D3D10_DSV_DIMENSION_TEXTURE2D;
    descDSV.Texture2D.MipSlice  = 0;
    if ( FAILED( mpDevice->CreateDepthStencilView( mpDepthStencilTex, &descDSV, &mDefaultDepthStencilTarget ) ) )
    {
        return false;
    }

    // Set the default render targets.
    mpDevice->OMSetRenderTargets( 1, &mDefaultRenderTarget, mDefaultDepthStencilTarget );

    mpEffectDevice  = new D3D10EffectStateDevice( GetDevice() );

    // Set the default render states.
    SetupRenderStates();

    // Set the default viewport.
    D3D10_VIEWPORT d3d10ViewPort;
    d3d10ViewPort.Width     = mInitParams.width;
    d3d10ViewPort.Height    = mInitParams.height;
    d3d10ViewPort.TopLeftX  = 0;
    d3d10ViewPort.TopLeftY  = 0;
    d3d10ViewPort.MinDepth  = 0.0f;
    d3d10ViewPort.MaxDepth  = 1.0f;

    GetDevice()->RSSetViewports( 1, &d3d10ViewPort );

I hope thats some help!

The following code worked for me (I'm using Microsoft Visual Studio Express 2012 for Windows Desktop)

DXGI_SWAP_CHAIN_DESC swapChainDesc;
swapChainDesc.BufferDesc.Width = width;
swapChainDesc.BufferDesc.Height = height;
swapChainDesc.BufferDesc.Format = DXGI_FORMAT_R8G8B8A8_UNORM;
swapChainDesc.BufferDesc.RefreshRate.Numerator = 60;
swapChainDesc.BufferDesc.RefreshRate.Denominator = 1;

swapChainDesc.SampleDesc.Count = 1;
swapChainDesc.SampleDesc.Quality = 0;

swapChainDesc.BufferUsage = DXGI_USAGE_RENDER_TARGET_OUTPUT;
swapChainDesc.BufferCount = 1;
swapChainDesc.OutputWindow = hWnd;
swapChainDesc.Windowed = true;
swapChainDesc.SwapEffect = DXGI_SWAP_EFFECT_DISCARD;

swapChainDesc.Flags = 0; 

ID3D11Device *pDevice = 0;
ID3D11DeviceContext *pContext = 0;
IDXGISwapChain *pSwapChain = 0;
HRESULT result;

result = D3D11CreateDeviceAndSwapChain(NULL, driverType, NULL, D3D11_CREATE_DEVICE_SINGLETHREADED, featureLevel, totalFeatureLevel, D3D11_SDK_VERSION, &swapChainDesc, &pSwapChain, &pDevice, &currentFeatureLevel, &pContext);

So you can just try adding more attributes to the swapChainDesc.