Msg 61700, Sev 19: Could not create component: x8007007E. Check registration of SQLVDI.DLL (4353520)

Msg 61700, Sev 19: Could not create component: x8007007E. Check registration of SQLVDI.DLL and value of IID.

VDI::Init -> Begin initiation of VDI configuration
VDI::InitVDI -> Error: 11700, Msg: Could not create component: x8007007E.
Check registration of SQLVDI.DLL and value of IID.
VDI::InitVDI -> Error: 11700, Msg: user defined exception
SLS::PerformOperation -> Error: 11700, Msg: Failed to initialise the configuration
OleDbConn::execTsql ->

use [LiteSpeedLocal] declare @activityIdOut int
set @activityIdOut = 8
exec LiteSpeed_InsertUpdateDatabaseActivity
@ActivityID=@activityIdOut output,
@ServerName='Test\Inst1', @DatabaseName='NorthWind',
@ActivityType=1, @Status=3, @DatabaseSize=674.0,
@PercentCompleted=100, @ActivityDetail='@DATABASE=''''NorthWind'''', @FILENAME=''''C:\Program Files\Microsoft SQL Server\MSSQL\BACKUP\NorthWind\NorthWind_LS_FULL_200612071537.BAK'''', @DESC=''''FULL backup of [NorthWind]'''', @BACKUPNAME=''''NorthWind'''', @INIT=1, @LOGGING=2', @ErrorMessage='61700 : Could not create component: x8007007E.

Check registration of SQLVDI.DLL and value of IID.

VDI is not configured correctly. - SQLVDI.DLL is not registered correctly.

This is a native Microsoft SQL Server Issue.

Possible cause:

1.There may be a combination of SQL 7, SQL Server 2000 and SQL Server 2005 on the same box and the sequence of installation of the SQL Servers are reversed.
2. Cluster Environment: SQLVDI.DLLs are located in different locations on each node and are not correctly registered.

Verify all the Instances/nodes are in the same service patches and the VDI are registered properly in the "Component Services" and in the registry.
Run "Regsvr32 <path>SQLVDI.DLL" to re-register the service on the node displaying error message.

For more information, please refer to the following Microsoft KBs.
http://support.microsoft.com/kb/830575
http://support.microsoft.com/kb/904418/en-us

If re-registering the Dlls does not resolve the issue, another option would be to copy a working SQLVDI.DLL from another server and registering it.  If neither of these option work, please contact Microsoft for support.