During installation Intel's Graphics driver installer changes the "SystemDirectory" string under "HKLM\SYSTEM\CurrentControlSet\Control\Windows" from "%SystemRoot%\system32" to "C:\Windows\SysWOW64". On top of that when you uninstall the driver it completely delete the string.
I'm not sure how significant changing/deleting the string is, but the string is a default part of Windows Vista/7/8.
I've attached install/uninstall logs. But it seems like a really quick fix would be to delete the following section from Setup.if2:
[Registry] operation=create root=HKLM path=System\CurrentControlSet\Control\Windows value=SystemDirectory data=%system% type=sz sequence=100 group=GFX