I think one of the tested machines is Vista RTM, though it's been 
updated.  I also tried of Vista x32 SP1 and it fails there.

If non-admin installs can't be made to work, I agree that the "for me" 
option be dropped and the installer changed to invoke UAC.  I looked for 
a solution to this, but so far can't find any -- and this would also 
mean that .pyd files in site-packages and elsewhere would need .manifest 
files that contain the path to where msvcr90.dll is located.  I think 
requiring an admin install might cause problems for py2exe though.

This is rather important because it means that python is unusable using 
the default installation options and I suspect that many users won't 
know how to install for everyone.

I'd still like to see the need to depend on a C runtime dll dropped at 
some point in the future, but I know that it's not an easy thing to do.