Windows XP Mode lost Integration Features

I use Windows XP Mode from Windows 7 Professional as sandboxes for testing and to evaluate applications (in this case, IAR Embedded Workbench which is quite good and you can use the JTAG via USB port forwarding). The advantage is that I don't pollute my 'nice' Windows 7 install will all sorts of bits & pieces and I certainly never have to 're-install the operating system'

So the way I work is that I installed Windows XP Mode, updated it to the latest service packs (which is a pain) and then saved a 'golden image' which I duplicate whenever I need to spawn a new VM.

Today, after the VM did some Microsoft Updating I found that Integration Features no longer worked - you get a dialog saying "Could Not Enable Integration Features" with options to Retry (see Einstein's definition of insanity) or Continue.

I tried re-installing Integration Features and it removed them(!). Then I tried re-re-installing Integration Features and they still don't work. Something is very badly wrong.

My solution is:

1. Uninstall Integration Features in your VM
2. Shutdown the VM
3. Delete the .vmc and .vmcx files BUT NOT THE .VHD
4. Create a new VM using the old .vhd
5. Re-install Integration Features in your VM

and that seems to work.

A better solution would be:

1. Install Windows XP Mode
2. Uninstall Virtual PC
3. Install Oracle VirtualBox
4. Open the WindowsXP.vhd in VirtualBox

but sadly Microsoft force you to use their rather second-rate VM solution so it doesn't work.