When doing this for friends I typically use a Ubuntu live CD and the install and use chntpw.
Boot from Ubuntu.
Go to System > Administration > Software Sources, and enable everything.
Use one of the various methods to install the software (depending on which version you have). I just typically prefer to open a terminal (Applications > Accessories) and type
sudo apt-get install chntpw
You should then be able to browse to the hard disk which will mount it automatically.
Getting to the password file, and using the tool is pretty straightforward, but you should look over some of the blogs and instructions available, something like
to get a feel for what is going on.
I just did this a couple of weeks ago on Windows 7 using Ubuntu 9.10. The biggest thing for a non-Linux user will be getting to the hard disk from the command prompt. If I remember right, after I browsed to the disk, I opened up Places > Computer, then right clicked on the mounted drive and looked at the properties to get the path. It will be different for every situation so listing it wouldn't be much help, but it wasn't very hard to figure out.
There is also apparently a live CD for just this purpose which I have never used, but basically takes the same approach. See http://pogostick.net/~pnh/ntpasswd/bootdisk.html.