Hello Slaman, I am sorry to hear that have had problems updating Intel Graphics Driver.
This type of error has been reported at Intel and several solutions were posted at the following http://www.intel.com/support/graphics/sb/cs-009483.htm
When you install the latest video drivers, I recommend forcing the installation of Intel generic drivers by performing manual procedure, see here for instructions: http://support.intel.com/support/graphics/sb/CS-022355.htm
Select your operating system version and download the zip version of the video driver:
Regarding point #3, it looks like a registry issue to me. I would recommend you to install the OS again from scratch.
Thanks for the response. As you'll see from my original post, I have already forced the Intel generic drivers in step #7.
I received the error message in step #3 prior to and immediately after a clean install.
I would recommend you get in touch with Lenovo since you have an OEM system. You can also try to install the previous OEM graphics driver.
I found out the following.
I installed generic VGA drivers and the crashing stopped... but this meant I had to run it at very low resolution and deal with a screen whose brightness I couldn't adjust.
I think installed the latest Lenovo drivers and changed the "theme" in Windows 7 to the bare bones basic. I disabled all the eye-candy and the problem decreased significantly (it still happened, but only a few times a day). I concluded that this must be a hardware issue... and it was. I had Lenovo replace the mainboard and all issues are gone.
Thanks for the responses Sylvia!
Thanks for letting me know Slaman.