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I’m trying to install an application on a Windows 7 computer (I right click the setup.exe and chooses run as administrator). However the installtion fails because it can not access a file in Windows\system32\. And Windows is showing saying something like “Re-install Program Using Recommended Settings” when I choose to do so the program is installed perfectly. But why do I need to do this? What are the “Recommended settings”? Do I need to change my users permissions?

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up vote 1 down vote accepted

Did you change the compatibility setting "Run this program in compatibility mode for:"?, Right click on the installer and do properties, then go to the compatibility tab. Set the compatibility for whatever OS the program was designed for. This is what recommended settings is doing for you in the background.

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Is this one specific application, or all apps? If it's one particular one, the installer itself may be defective. Try downloading it again, or check the knowledgebase/forums for that particular program to see if anyone else reports the same problem. (If you specified the app in your question, someone here might be able to help, but the current question is very vague.)

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The installer is probably not made for your operating system.
It refers to a DLL that is missing on your Windows installation.

More info is required for giving a better answer.

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