I have a few multi-user standalone machines in a closed area (e.g. no network/internet connection). My users get the error (quoted in the title of this thread) when I set the following flag to enabled:

Shutdown system immediately if unable to log security audits

Unfortunately, I MUST have this setting enabled. Microsoft does recognize this issue, and suggests I turn it to disabled by editing the proper registry key. This is not an option for me. Has anyone else had a problem like this and found an adequate work around?