On Windows 7 Professional N 64bit, the visual effect option "Enable desktop composition" does not work correctly for me.
Both the DWM and Themes services are running.
When I tick it and click "apply" or "ok", nothing will happen, and when I close and reopen the Performance Options window, the box is unticked again.
The only way I can get it to work is by using the "Adjust for best appearence" preset, which ticks all boxes and does in fact enable desktop composition.
As soon as I untick any other item, the preset jumps back to "Custom", and upon closing / reopening the Performance Options window, desktop composition is disabled again.
I set HKEY_CURRENT_USER\Software\Microsoft\Windows\DWM\Composition to 1 and HKEY_CURRENT_USER\Software\Microsoft\Windows\DWM\CompositionPolicy to 2.
After a reboot, CompositionPolicy was reset back to 0, Composition was still at 1.
I'm at a loss because there's no error message / log entry that I can find.