Selecting Grub2 menu item for Windows 7 reboots PC

After installing Ubuntu 9.10 I am unable to use the GRUB2 menu to boot into Windows. When I select Windows from the GRUB menu the PC simply reboots.

This happens using both desktop and alternate installs of 32bit and 64 bit Ubuntu 9.10. I am also unable to load GRUB to a floppy or USB stick as the installer fails to recognise the media, producing a 'fatal error' message - I then either have to choose to install to hd0 so I can't boot Windows or not to install so I can't boot Ubuntu.

I have also tried various install combinations, the latest of which means i have removed my 2nd disk and I'm installing Ubuntu to a partition on the same drive as the Windows partition. There are no other hard drives connected to the system, but the same problem remains:
* Windows 7 RC Build 7100 64bit is on SDA1
* Linux Boot is on SDA5
* Linux SWAP is on SDA6
* Linux Ubuntu 9.10 is on SDA7

During all alternate installs I have selected /dev/sda as the location for installation of GRUB. During all desktop installs I have confirmed the installation path for GRUB is hd0. The GRUB menu correctly identifies in every install that the Windows loader is a Windows 7 loader on /dev/sda1.

I have also posted a query to the Ubuntu forums but I'm not having much luck - lots of responses, but either they haven't read the post and the problem or I get advised that their similar setup works fine and I should search the forums for a response. NOT very helpful :( http://ubuntuforums.org/showthread.php?t=1312894

My ultimate aim is to be able to select my OS using Grub2 (i like the idea of being able to use background images), although I will settle for another solution that works, for example having to use a floppy disk to boot - I do not want to have to use EasyBCD.

Thanks
Lee