Kept getting MTP USB Device failed. Works fine on my other Windows 7 machines.

Oddly, this worked (you have to run CMD as admin):

net localgroup Administrators local service /add

 

http://answers.microsoft.com/en-us/windows/forum/windows_7-hardware/the-mtp-usb-device-driver-doesnt-install-i-cannot/c85da1e4-9303-4d36-8659-c06864554cbe?auth=1