That error message is innocuous, it's only that GM can't access the usual registry key it would find in Win XP, so it just complains. Now, that happens because you're probably double-clicking on the executable. You're not supposed to lauch GM that way, you either launch it from command-line or from a properly configured frontend.
I would definitely use Windows XP 64-bit instead of Windows 7 for serious CRT stuff. That said, try to get things working in Win 7, and please report back if you succeed.