ReportBuilder.application fails on my PC - but works on localhost - sql-server-2005

Question

We're running SQL 2005 on Win2K3 server and are using SSRS. Here's the situation:
I can run Report Builder from localhost
My coworker can run Report Builder on his Vista computer
Another coworker can run Report Builder on his XP SP3 computer (IE7)
I can NOT run Report Builder on my XP SP3 computer (IE7)
I'm told that it could be anything from an errant registry entry to a group policy problem. Here is what I've tried:
Put the site into "Trusted Sites" with "low" security
re-install .NET
create a new local user account and attempt to run it
The results? Every single time, I get a dialog box: "Application cannot be started. Contact the application vendor"
I click the details button and get this:
PLATFORM VERSION INFO
Windows : 5.1.2600.196608 (Win32NT)
Common Language Runtime : 2.0.50727.3607
System.Deployment.dll : 2.0.50727.3053 (netfxsp.050727-3000)
mscorwks.dll : 2.0.50727.3607 (GDR.050727-3600)
dfdll.dll : 2.0.50727.3053 (netfxsp.050727-3000)
dfshim.dll : 2.0.50727.3053 (netfxsp.050727-3000)
SOURCES
Deployment url : http://www.example.com/ReportServer/ReportBuilder/ReportBuilder.application
Server : Microsoft-IIS/6.0
X-Powered-By : ASP.NET
X-AspNet-Version: 2.0.50727
IDENTITIES
Deployment Identity : ReportBuilder.application, Version=9.0.3042.0, Culture=neutral, PublicKeyToken=c3bce3770c238a49, processorArchitecture=msil
APPLICATION SUMMARY
* Online only application.
* Trust url parameter is set.
ERROR SUMMARY
Below is a summary of the errors, details of these errors are listed later in the log.
* Activation of http://www.example.com/ReportServer/ReportBuilder/ReportBuilder.application resulted in exception. Following failure messages were detected:
+ Value does not fall within the expected range.
COMPONENT STORE TRANSACTION FAILURE SUMMARY
No transaction error was detected.
WARNINGS
There were no warnings during this operation.
OPERATION PROGRESS STATUS
* [4/7/2010 2:53:57 PM] : Activation of http://www.example.com/ReportServer/ReportBuilder/ReportBuilder.application has started.
* [4/7/2010 2:53:58 PM] : Processing of deployment manifest has successfully completed.
ERROR DETAILS
Following errors were detected during this operation.
* [4/7/2010 2:53:58 PM] System.ArgumentException
- Value does not fall within the expected range.
- Source: System.Deployment
- Stack trace:
at System.Deployment.Application.NativeMethods.CorLaunchApplication(UInt32 hostType, String applicationFullName, Int32 manifestPathsCount, String[] manifestPaths, Int32 activationDataCount, String[] activationData, PROCESS_INFORMATION processInformation)
at System.Deployment.Application.ComponentStore.ActivateApplication(DefinitionAppId appId, String activationParameter, Boolean useActivationParameter)
at System.Deployment.Application.SubscriptionStore.ActivateApplication(DefinitionAppId appId, String activationParameter, Boolean useActivationParameter)
at System.Deployment.Application.ApplicationActivator.Activate(DefinitionAppId appId, AssemblyManifest appManifest, String activationParameter, Boolean useActivationParameter)
at System.Deployment.Application.ApplicationActivator.PerformDeploymentActivation(Uri activationUri, Boolean isShortcut, String textualSubId, String deploymentProviderUrlFromExtension, BrowserSettings browserSettings, String& errorPageUrl)
at System.Deployment.Application.ApplicationActivator.ActivateDeploymentWorker(Object state)
COMPONENT STORE TRANSACTION DETAILS
* Transaction at [4/7/2010 2:53:58 PM]
+ System.Deployment.Internal.Isolation.StoreOperationSetDeploymentMetadata
- Status: Set
- HRESULT: 0x0
+ System.Deployment.Internal.Isolation.StoreTransactionOperationType (27)
- HRESULT: 0x0
I'm really at a loss. I'm certain there is something on my PC preventing the application from running - but I just don't know what. Google hasn't been much of a help because most problems are related to the server configuration (which I know is correct since it works on other PCs)
Help me, Overflow Kenobi, you're my only hope..

Answer 1

Since you asked so long ago, most probably you don't need this anymore.
Hopefully, since you found the answer and not because you simply quit.
I ran against this problem, also. After some time, found the reason: when a ClickOnce application is executed for the first time on a machine, the URL it was installed from becomes part of this apps' signature.
Unfortunately, this also means when you try to run same application, with exactly same manifest, from another URL you get this or very similar errors.
So if you have a local instance of SQL Server with Reporting Services, and run Report Builder 3.0 for the first time from Report Manager's "Start Report Builder" then next time you try to run it from a real server's Report Manager's link (not from your localhost's) you'll get this error.
The workaround is to manually purge the ClickOnce cache (source):
For Windows Vista:
Find folder <user>\AppData\Local\Apps
Delete the 2.0 folder
Pre-Vista:
Find folder ...\Documents and Settings\<user>\Local Settings\Apps
Delete the 2.0 folder