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The Acer Aspire One Netbook has a hidden partition containing the files required for restoration to the original factory condition. The restoration clears all user data from the C: drive and requires that you have the netbook plugged into its AC adapter as the process takes significant time during which it should not be interrupted at the risk of hard disk corruption. To begun the process.... 1. power on the netbook while it is plugged into its AC adapter 2. during power-on, while the Acer Logo is showing, press Alt and F10 together several times 3. Acer eRecovery loads showing the Windows screen momentarily 4. follow the on-screen directions and make the selection to recover the factory default image
The image stored on your laptop to restore it to factory original is corrupted. If the laptop still boots, try to make restore media using the acer erecovery management console, although this will likely not work if the image is corrupt. Try installing windows with these discs if you can. If not you have 2 options:
Contact acer and order restore discs (free if in warranty) or about $50 out of warranty.
Reinstall windows using an OEM Windows cd and the keycode on the windows sticker on the bottom of the laptop. You will have to download all hardware drivers manually though, and you will not have any of the softawre provided by acer. The restore discs from acer are by far the best option....Let me know if this helps.
Creating recovery discs After setting up the computer for the first time, be sure to create a set of recovery discs of the full factory image.
the recovery discs are used to start up (boot) the computer and recover the operating system and software to factory settings in case of system instability or failure.
Seems like the preinstalled image is corrupt or there is a hardware problem. Contact Acer for the correct procedure since this is a new system. I could offer alternate methods if you have the Windows install disc, but it is best to contact the manufacturer as soon as possible so it is on record.