power policy unable to reserve hibernate file...error when I try to hibernate!

cntl panel - pwr opts - hibernate - uncheck enable hibernation & reboot into safe mode and try deleting hiberfil.sys.

Disable absolutly everything in msconfig. (I do mean EVERYTHING)

Check if your antivirus is is running a scan at the time of hibernation or force a hibernation.

Check if there are any other things running (limewire, kazaa, etc) which might be taking up resources/preventing hibernation.

http://support.microsoft.com/?kbid=306676 <-- I think you have seen this.

Holding down shift when you click on shutdown menu will probably bring up the hibernation option. Also deleting: nohiber.txt might bring up the option under shutdown.

i am still having the problem of not being able to hibernate. "enable hibernation" is already unchecked and it's when I try to click the check box to enable it that it gives me the same error over and over again.

did you try rebooting into safe mode command prompt & deleting the hiberfil.sys? hold f8 during boot for boot menu & select safe mode command prompt, then do:
cd\
dir hiberfil.sys /s    to find where the file is located,
move to that path like, cd c:\windows
then delete that file like so, del c:\hiberfil.sys
then reboot into normal mode

are you using Nero 5?
http://support.microsoft.com/kb/331506/en-us
3d screensavers on xpsp1
http://support.microsoft.com/kb/306676/en-us

I am not using any Nero products, although I do have Roxio media suite 8 installed. I tried the commands under dos prompt and it says hiberfil.sys not found. I thought I had created a hiberfil.sys file in the root of c:/ because I can see it there in explorer, but I guess I didn't create it correctly?!? (I copied another .sys file, pasted,  and then renamed it and lastly deleted content within the file to clear it out.)

it could be a hidden or system file try doing
dir hib*.* /ah /s
dir hib*.* /as /s

I finally figured it out! Another website mentioned the need to go into the registry and windows explorer to delete files created by daemon tools that are not removed by a simple uninstall. The filenames I deleted were a347bus.sys, a347prt.sys, d347bus.sys and d347scsi.sys. I rebooted and am now able to hibernate!

Woops I forgot...the previously mentioned files are under c:/windows/system32/ in explorer and under local machine ->system->currentcontrolset->services when using regedit. Hope this helps others with this same crazy problem!

you originally stated "I have no daemon tools"

what was the daemon tools that were removed?

plz post the html link to that other website here.

I thought I didn't have Daemon anymore because I uninstalled it. Apparently the software uninstall does not take care of these files and you have to go in and manually remove them...at least on my machine I did. The link is here -> http://www.mcse.ms/archive66-2005-7-1314809.html

thanks, that will help out anybody with a similar situation.

you should request a refund in community support since you solved this yourself.