Hello, yes this could be the main cause of your problem other people have experienced the same problem.
I know it sounds unsafe but it has something to do with security permissions on your PC and the ie7 update.
Make sure you are logged in as Administrator when you go into safe mode.
Once you have re-tried the installation, run a scan just in case you have an infection.
If this doesn't work we will need to check the permissions for your Admin account.
If this doesn't resolve the problem, you may have to alter the registry directly.
If you are inexperienced this may sound a bit daunting. A back-up of your registry can easily be made before you try it, as well as setting a system restore point.
However you do of course have the option to carry on using your earlier version of ie.