Microsoft released an update to MSN Messenger 7.5 which caused the services file to be unavailable.
You need to perform the following steps to resolve the issue on the client machine:
Check this registry key :
In this key, the DataBasePath Value must have a REG_EXPAND_SZ and not a REG_SZ Type.
The data here must be %SystemRoot%\system32\drivers\etc
Note: It seems that this will appear when you update MSN Messenger with a new version.
Once you have done this you need to reboot the client machine and the problem should be resolved.