Very Bad Things...

Whoa... Ran across this a while ago, and again just this AM. But the first time I saw it was too late.
"When you restart a computer that is running Windows Server 2003 or Windows 2000 Server, the computer stops responding, or the "Applying computer settings" screen appears for longer than you expect"
http://support.microsoft.com/?kbid=905716

Ran into a system where we could not install a service using the Win32 API CreateService (API would hang). We were also unable to delete a service using DeleteService. Tried various techniques to troubleshoot the problem, but the system wasn't even able to shutdown gracefully. Thought there might be a virus so we had the admin of the system run a scan. Nothing turned up. Wound up trying INSTSRV from the Resource Kit. That too would hang. But I used Dr. Watson to get a memory dump of the process and analyzed it in WinDBG to verify that it, too, was hanging in CreateService. We thought that perhaps there was something installed on the system that was causing some sort of a conflict, so we tried to stop a number of services on the system. Amazingly, none of the services would stop - they would get into a state of "Stopping", and stay there. Customer said they had other problems with the system, too, and were considering replacing it. So we didn't do anything more with the system. But one of the services I noted on the system that would have problems from time to time was "APCPBEAgent" (referenced in the above KB article) - it would sometimes remain in a state of "Starting" for 5+ minutes. I suspect that the problems with the system were a direct result of the issue outlined in the KB article.

CAUSE
This problem occurs because of a problem with version 6.x of APC PowerChute Business Edition Software. APC has issued the following official statement about this issue:

The APC 6.x software uses Sun Microsystems Java Cryptography Extension(JCE) 1.2.1 Package. The digital certificate that was used to sign the JCE 1.2.1 jar files expired on July 27, 2005. Because of this, the system causes the above detailed symptoms.

Yuck.