Unfortunately I don’t have a restore point from that long ago. But I did finally find the Windows Live Sign In Assistant as a running Service. Disabling the service and restarting does not fix the WDTV’s login issue.
But I don’t agree that this is a Microsoft issue. The WDTV Live has many flaws, and this is another that needs to be addressed with new firmware. I can still connect to my windows 7 file share from my mac. I can connect from other windows machines on the network. Only the WDTV has problems connecting. It’s a very problematic device.