So it doesn't seem to be a Windows 7 issue. I tried this on a windows xp 
machine with similar results. So here's what I noticed.

I can log into the machine with the simple command "/usr/bin/smbclient 
\\\\computer\\C\$ -U domain\\backuppc" I seem to be able to traverse through 
most directories listing contents of different directories. The domain account 
has both domain admin and backup operator membership. 

However when the backup runs the full smbclient command it fails. Here is the 
full log:

Running: /usr/bin/smbclient \\\\computer\\C\$ -U domain\\backuppc -E -d 1 -c 
tarmode\ full -Tc -
full backup started for share C$
Xfer PIDs are now 9145,9144
Domain=[CREATIVITY] OS=[Windows 7 Professional 7601 Service Pack 1] 
Server=[Windows 7 Professional 6.1]
tarmode is now full, system, hidden, noreset, verbose
NT_STATUS_ACCESS_DENIED listing \$Recycle.Bin\S-1-5-18\*
NT_STATUS_ACCESS_DENIED listing \$Recycle.Bin\*
This backup will fail because: NT_STATUS_ACCESS_DENIED listing \\*
NT_STATUS_ACCESS_DENIED listing \\*
tar: dumped 2 files and directories
Total bytes written: 0
tarExtract: Use of qw(...) as parentheses is deprecated at 
/usr/share/backuppc/lib/BackupPC/Storage/Text.pm line 302.
tarExtract: Use of qw(...) as parentheses is deprecated at 
/usr/share/backuppc/lib/BackupPC/Lib.pm line 1425.
  create d 755       0/0           0 $Recycle.Bin
  create d 755       0/0           0 $Recycle.Bin/S-1-5-18
tarExtract: Done: 0 errors, 0 filesExist, 0 sizeExist, 0 sizeExistComp, 0 
filesTotal, 0 sizeTotal
Got fatal error during xfer (NT_STATUS_ACCESS_DENIED listing \\*)
Backup aborted (NT_STATUS_ACCESS_DENIED listing \\*)
Not saving this as a partial backup since it has fewer files than the prior one 
(got 1 and 0 files versus 1)

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