Yay!
Found a fix while doing some extra research all over the net. Please check
out:
http://ms-os.com/showthread.php?t=34308
Problem was that some buggy program had decided to strip my computer's
SYSTEM account of any rights to the C: drive of my machine. This prevented
the SYSTEM from doing its do.
The linked discussion talks about another error number 0xC8000408 (though
which was actually in my update log as one of the errors.), but it fixes the
0x80248011 at least in my case. My System Restore has also started work again.
There was a thread about this possibility of problem by echsb here in the
newsgroups, I'm putting this same text there.