Ryan Seto added the comment:
I came across this issue while trying to install mercurial using easy_install.
I applied the vcvars4.diff to my distutils and this solved the problem.
Environment:
Python 2.6.6 (64 bit)
setuptools-0.6c11.tar.gz
installed using the following instructions:
http://stackoverflow.com/questions/309412/how-to-setup-setuptools-for-python-2-6-on-windows
pywin32-214.win-amd64-py2.6 (installed binaries)
py2exe-0.6.9.win64-py2.6.amd64 (installed binaries)
Windows 7 (64 bit)
Visual Studio Team System 2008 (installed everything)
Visual Studio 2008 SDK 1.1 (installed everything)
--
nosy: +MrWerewolf
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