Application not installed - computer not authorized

Dear Experts,
I'm going mad trying to get my wife's iPhone to sync her applications (why does she always get the difficult problems?). She has a new iPhone - the last one she managed to flush down the toilet. I'm trying to reinstall the applications that she previously bought. For all applications I get the message "The application XXX was not installed on the iPhone YYY because you are not authorised for it on this computer".
Note: 1) The PC is authorized because I can (re)download the applications concerned. 2) I can also access my wife's Store account.
Now I have surfed the web and tried the various things suggested, including:
1) Double clicking the applications in the iTunes application folder. When I do this I'm asked to authorize the application for the PC, which I then do and it (seems to) accept it. However if I immediately double click again, again I'm asked to auithorize the application again????.
2) I have completely removed iTunes and everything, including the Apple Computer directory in the Vista "roaming" folder. I have then reinstalled it and reconfigured it, reauthorized the PC and redownloaded the applications. The result is the SAME, arrrgghhhh!
So, anyone got any idea what is going on? At the moment I feel like taking an axe to the damned thing. This 'authorization' business is a pain in the ...
Thanks in advance.
Extrapilot144

Hiya. Just doublechecking ... have you worked through the following document in the course of your troubleshooting to date?
[iTunes repeatedly prompts to authorize computer to play iTunes Store purchases|http://support.apple.com/kb/TS1389]

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