Daphra, sorry to hear that this has been such a pain in your side. I wish that you were in the majority of people who have never heard of or seen this error.
Since you /are/ stuck, though, and you report having already tried setting your TEMP Environment variable to a path that has no non-ASCII characters (something like "C:\Temp" [without the quotes] I presume), would you follow Eric Stollnitz's instructions in the end of this discussion on the ICE forums: http://social.microsoft.com/Forums/en-US/ice/thread/c6de8c00-cc06-4701-b462-264047f68e14 to help the ICE team troubleshoot what is going wrong for people like you?
Thanks for not giving up yet. I look forward to seeing your panos around the site.
Your fellow panner and photosynther,