several hours came and went banging my head against the wall after getting this error msg.
all started when i decided to finally uninstall vs 2003 and i guess it removed some dlls that i shouldn't have to...
i'm fairly pissed off right now so lets skip to the solution:
after deciding not reinstall windows because of this, at least i decided to put xp sp3, although i didn't really needed to...anyway this didn't help =/
after absurdly many hours of google search i came to this page - http://www.techsupportforum.com/microsoft-support/windows-xp-support/169616-incorrect-mfc-dll-version-installed-system.html
and this hint led me to open my services tab, kill the fukking 'tray service' and write this blog, quite sardonically if i may add...
damn software :)