Try the following method to solve the problem (for those who set a password on the pc):
1. Close Msn completely (make sure is exit completely)
2. Go to Start --> control panel --> user accounts
3. Remove the password of your account
4. Open Msn and sign in (you should be able to sign in).
5. Go to Start --> control panel --> user accounts and set password again (Don't sign out msn, make sure msn is signed in when you set the password.
copy paste from here http://ysolution.blogspot.com/2008/05/msn-error-code-80070005-service.html
try it it may work