I ended up getting the problem fixed, thanks for the offer of help though. The resolution was to delete the $Winnt$.inf file in the Windows\System32 directory. Every time you run sysprep this file is/was supposed to be over written but it was not. Once I deleted the file and reran sysprep all was good. Apparently there is a certain Microsoft hotfix that prevents you from updating this file but I have not confirmed this so I'm not sure if that is really the case.