Confusing? Actually we are talking about "Windows 7 Starter Edition" here which should be better called "Windows 7 Restricted Edition".
Why? As we all know previous Windows Starter Editions didn't allow users to open more than 3 programs simultaneously and the same restrictions is found in recently leaked Windows 7 Starter Edition Build 7068.

But the most irritating and surprising thing in Windows 7 Starter Edition is the restriction over changing Desktop Wallpaper.
Windows 7 Starter Edition contains a grayed-out version of default Windows 7 beta wallpaper showing the fish on Desktop.

And the worst thing is, users are not allowed to change the wallpaper. There is no "Personalize" option in Desktop context menu:

Also no other ways to change wallpaper works like changing wallpaper using Windows Photo Gallery, web browser, etc. That's really strange and hard to understand why Microsoft restricted such a basic feature even free Linux distros allow to change wallpapers.
Also there are no extra wallpapers in Starter Edition.
Thanks to "Paul Thurrott" who installed the recently leaked Windows 7 Build 7068 and tested all different editions like Starter, Home Basic, Home Premium, Professional and Ultimate and found this interesting restriction in Starter Edition.
Also "Rafael" @ WithinWindows describes how this restriction works in Windows 7 Starter Edition. He posts:
In Windows 7, a new licensing bit was introduced – ChangeDesktopBackground-Enabled. On Starter Edition SKUs, this bit is set to 0, disabling background setting capabilities in Windows Photo Viewer and the Display/Theme Control Panel applets. The infection goes deeper into system files shell32.dll and themeui.dll too, hard-coding the wallpaper to %windir%\web\wallpaper\windows\img0.jpg.
He also posts a workaround for it:
1. As an Administrator, reset the permissions on img0.jpg, and overwrite file with any other picture
2. Use third-party software (note: changes will likely not persist, untested)
So what would you like to call it: Windows 7 Starter Edition or Windows 7 Restricted Edition?
PS: I can find only one reason behind it. Since Starter Edition is form OEMs, they might put their own customized wallpaper and lock it so that users can't change it and OEMs can have their branded wallpaper on all machines.
This article was posted by VG in following section: Windows 7.
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VG
^^ No need to apologize mate. As I earlier said everyone has rights here to post whatever he wants. The only thing I want is a friendly environment. :)
Bahjaw
Making the starter edition free is a good idea, But microsoft went off the deep end making all those restrictions, Agreed, I'm going to suggest a name change to Windows 7! Restricted Edition!
Dementor
goldi, to enable edition selection open your 7068 image with, for example, UltraISO and remove the file ei.cfg from sources folder.
And of course you need to perform new installation, not upgrade.
goldi
@ Dementor
Thanks for suggestion, but after this i think dvd is not bootable !
@ ALL
Here we are students & VG is Teacher , so respect each other & maintain friendly environment
Nikolaj
OMG it is limited to that boring gray wallpaper???
Dementor
@goldi:
I did this and after it burnt the image to DVD-RW and booted and installed normally, with SKU selection!
mustapha
hi
please
i terribly need windows 7
before three months i download three version of windows
but no one of those want to install because of "interrupted file"
need help
Ex Back
Hey, cool tips. Perhaps I'll buy a bottle of beer to that man from that forum who told me to go to your site :)
APL
hi just thought id get my 2 cent in this is'nt anything new vista also had this Edition as many people have alreddy mention it is made for low spec pcs and places like internet caffes that oni need to run a few app at a time with vista you could'nt buy it outside te us and even then it was very hard to cum accross.
Dragon
You Could Always Buy A Pirate Windows 7 Ultimate Or Home Basic.