OK, the latest is that I reformatted my drive (yet again) because the copy of Vista I have, has some sort of problem where I can not change the work-group name. I thought that in some strange way this same issue is effecting why Wiiload will not work from the contextual menu.
So I reformatted the drive and installed Windows 7 and I'm having the exact same problems.
Either when I do everything manually or I use one of the automated programs like Wiiload 1.01.