Error 797: Modem not Found

I had a user ring me twice with this problem. The symptoms both the same. A windows VPN connection trying to access a bog standard Windows server configured for remote access. Works fine for a while and then they get the Error 797 cannot find modem.

The issue is that the VPN connection suddenly can't see the LAN connection and tries to use a modem connection. The first time I got around the problem was to re-install the wireless drivers, user was using wireless at the time, and re-set up the VPN connection.

Now the machine did have references to an old 3G modem which the user never used. I assumed this is what the VPN connection was falling back to when it didn't like the LAN connection any more.

1. So I first removed all references to this modem in both "Control Panel" and "Network Connections"
2. Checked in Device manager.
3. Clicked on View\Show Hidden Devices
4. Click on "Non-Plug and Play Drivers
5. Under here there was an entry called "NDProxy" this was marked as "Device not working properly" So I deleted it and restarted the machine.
6. Then I set up the VPN connection again and it worked.

UPDATE: Strangely I have had a second laptop turn up with the same issue. However, even after disabling the modem in BIOS I was unable to stop the VPN connection trying to look for a modem. In the end I had to re-install windows. 

I really hope that a windows update hasn't caused this as I will be dealing with a lot more laptop.

2ND UPDATE: The first laptop which I thought I managed to fix now looks like it connects but just after the "Registering your computer" message appears, it drops the connection and tries to redial. As a result I will be rebuilding that machine also.