Authorize computer in a loop after upgrading to 7.7.1.11

Question

We have been working with iTunes Store Support for a week, but have not been able to resolve the following issue.
We upgraded to 7.7.1.11 on 8/3, since the upgrade none of the hundreds of songs videos and TVShows purchased and downloaded prior to Sunday 8/3 will play in Itunes or the iPod touch (16Gb with 2.0 software update installed).
When we click on a song, movie or show, we receive the message "This computer is not authorized ...."
We than put in the password and receive the message: "Machine Authorization was Successful", but the songs/videos/shows still don't play. When you click on it again it asked again for authorization.
We were allowed to download a purchase from the weekend again and that works fine with the same account/password information, but previous purchases don't work at all.
We have followed multiple set of instructions received from iTunes Store support and the support website, including:
1) De-authorizing, re-authorizing
2) Re-installing iTunes
3) Removing the SC folder
4) Re-building the iTunes Library
5) Re-building iTunes Preferences
6) Creating a new user acount and installing iTunes
7) Installing iTunes on a different computer with a different operating system (Windows 2000 instead of XP SP 3)
8) Re-installed songs from a backup ...
9) Updating iTunes Store Account Information, as instructed by support.
10) Scanned for viruses ...
11) Updated Windows XP ...
12) Restored iPod Touch software
We have been loyal shareholders and customers to Apple and iTunes and were in the process of purchasing iPhones for the family, but this is becoming very aggravating.
I have never allowed my son to download music from other sources and been giving him an allowance to buy ftom iTunes. We have a lot of money invested in it and would like to see this resolved as soon as possible, but don't know were to turn from here.
Any suggestions are welcome.

Answer 1

We have this very same problem.
Our family have used iTunes and Apple TV almost exclusively now for at least 6 months buying online media.
We have invested well over $1,200 including an Apple TV, and as of the last update ALL of our content has been locked out.
We can not play any of our Apple TV Content - movies we have purchased, box sets we have downloaded (and only watched half of).
Music we have paid for and downloaded.
All of it is now locked up in this Authorization Loop error.
We have emailed support, and received the "We want your iTunes experience to be the best possible" lip service only and a promise that they are investigating. This is also the THIRD time we have had this problem.
We have tried the install/re-install;
The deauthorization/re-authorization;
Deleting library files;
Installing iTunes on ANOTHER computer;
None of it has worked.
Not to mention every time we try one of these crazy time consuming "fixes" the Apple TV deletes all the files and has to re-sync which takes several hours as we have a lot of content.
As of last night we have decided as a family to no longer use any of Apple's online media services.
There are countless other vendors and on demand media services now that it seems pointless and almost diabolical to continue with a company that has so many technical problems - yet pretends it does not.
We were in the process of looking at buying a couple of iPhones and even a Mac laptop. But there is no way we can bury ourselves in deeper with a company that at a whim, can LOCK down all of our content and offer no explanation for it other than they hope we enjoy our iTunes experience.
Well this is a notice that we are most certainly NOT enjoying our iTunes experience and Apple, you have received our very last dollar.
Regards,