I'm almost about to headbang like MagicAndre1981's avatar, as his hints have now solved my problem, which was obviously the same as ZippyV's. I know that many people whio had similar problems had resorted to perform an update install of Windows 7. In all the resources I have found so far about the vcredist error 1935 with HRESULT 0x8007054F there was nobody who had a clue what the problem really was about. I have encountered the setautoreset solution somewhere else, but without any reasoning about why it was necessary.
Thanks for posting this solution and also thanks to ZippyV for his perseverence in solving his problem.
If anybody from Microsoft is reading this, it may make sense to spread this knowledge more widely because it might save some people from resorting to more intrusive ways of trying to solve the problem like messing up the registry (I didn't), deleting files by hand in winsxs (I did - had to restore them), etc.
Cheers and happy coding.