Notice that the desktop background slide show is not available in Windows 7 Home Basic and in Windows 7 Starter.
Since Microsoft limits you, your best shot is to use a third-party tool like John’s Background Switcher
JBS sits in your system tray (down by the clock) and changes your background at the time interval of your choosing. You tell it where to get pictures from and how to show them – maybe you just want to see one photo at a time or maybe you’d like to see a ‘Snapshot Scrapbook‘ of photos thrown across your desktop. It’s up to you and you never know what’s coming next!
Use Powershell together with a scheduled task to change backgrounds periodically.
This is by far the most interesting and geeky solution. Go for this please! :)
$folder = "c:\Users\Public\Pictures\Wallpaper"
$file = Get-ChildItem $folder | Get-Random
$signature = @'
public static extern uint SystemParametersInfo(
$type = Add-Type -MemberDefinition $signature `
-Name Win32Utils -Namespace SystemParametersInfo `
$null = $type::SystemParametersInfo(20, 0, $file.FullName, 3)
Read more on this comprehensive how-to: Desktop Background Slideshow in Windows Home Basic, with Powershell