Uninstall Postgresql net user postgres /delete

Solution:
- Uninstall PostgreSQL
- net user postgres /delete
- Control Panel -> User Accounts -> Configure advanced user profile properties -> delete all "Unknown User" instances that seem to be left from postgres
- compmgmt.msc -> Local Users and Groups -> Users -> New User... -> User name: postgres, Password: postgrespass -> Create
- compmgmt.msc -> Local Users and Groups -> Users -> postgres -> Member of -> Add... -> Administrators -> OK
- copy postgresql-8.4.9-1-windows.exe to C:\
- runas /user:postgres cmd.exe -> cd \ -> postgresql-8.4.9-1-windows.exe -> installed successfully without errors. Checked data folder and confirmed files created successfully.
- compmgmt.msc -> Local Users and Groups -> Users -> postgres -> Member of -> Administrators -> Remove
- compmgmt.msc -> Local Users and Groups -> Users -> postgres -> Member of -> Add... -> Power Users -> OK
- Installed HM2 -> created db successfully
- Restarted computer -> HM2 runs properly (i.e. just to check postgresql service starts automatically)

Kind of annoying that no one else seems to have had this specific problem with postgresql on the HM forums.

Oh, related troubleshooting step that might help others. I had an earlier problem of *.vbs files being associated with vim instead of Windows Scripting Host when trying to install another program. So if youre getting Visual C++ errors even though you've got Visual C++ 2005/2008/2010 redistributables installed, try registering vbscript.dll:

- regsvr32 %systemroot%\system32\vbscript.dll