I'm trying to get to grips with Win7. Grrr.
I'm thought I'd try to update some of my drivers. Downloaded one from the net and extracted it to a temp folder on Drive C.
Do you think it will let me update? Access to the file is denied. I've tried changing the attributes, changing the sharing, even the ownership, but I still get the same message and still that bloody padlock is showing next to the file.
Damnable nightmare.

Is it extracting the file, or actually installing the driver.
Former should download to user's Download folder (assuming IE9, if not using IE9, why not?) which the user will have full access to.
Later requires signed drivers (ideally under 32bit, enforced under 64bit (yeah, yeah, workarounds possible)).
I presume you are running as an administrative user (naughty boy), but you still need to get out of the mindset that you have unrestricted access to the system.