I understand your frustration.
I recently upgraded to Vista Enterprise and managed to successfully install Sitefinity v3.1. I am listing below the step by step process that I used to get Sitefinity going on Vista. It should be the same for your Vista Business (IIS 7.0).
1. Disable UAC - In my opinion, It is the best way to get rid of the whole "run as administrator" fiasco altogether.http://www.windowsnetworking.com/kbase/WindowsTips/WindowsVista/AdminTips/Security/DisablingUAC.html
2. Uninstall the current installation of Sitefinity. The uninstall program that comes bundled with Sitefinity usually does a good job cleaning up for me. I have had to delete the Telerik folder manually a couple of times though.
3. Set up your IIS 7.0 to run in IIS 6.0 compatibility mode. There is a lot of information available online for it. And actually, the installation document provided by the Telerik team is a pretty decent resource as well: http://www.sitefinity.com/support/documentation.aspx
Make sure that you follow all the steps.
4. Install Sitefinity v3.1.
That should do it, hopefully! I have not been able to get rid of "login" challenge every time I start Sitefinity. As a workaround, I had to create a User account (Admin role) with password and use that to login.
I hope I was of some help. Good luck!